In a major development for the cryptocurrency market, BlackRock, the world’s largest asset manager, filed last week for a bitcoin BTC 0.41% spot exchange-traded fund (ETF). The announcement caused a stir in the market as investors eagerly awaited the possible approval of the first U.S. bitcoin ETF.
Grayscale Bitcoin Trust (GBTC) experienced a significant surge of more than 12% on Friday following the BlackRock filing.
Grayscale’s flagship product, GBTC, allows investors to trade shares in trusts that hold bitcoin pools. Per Share is designed to track the current price of Bitcoin, enabling investors to gain exposure to the cryptocurrency without owning it directly.
The surge in the price of GBTC can be attributed to market optimism over the BlackRock ETF application. If approved, the bitcoin spot ETF would provide institutional and retail investors a more accessible and regulated way to invest in bitcoin. The development marks a major step towards mainstream adoption of the leading cryptocurrency.
Additionally, the “GBTC Discount” hit a monthly low of -36.61%, according to YCharts. The discount refers to the difference between the stock price and the net asset value (NAV) of the Bitcoin assets held by GBTC. The data shows that investors are increasingly recognizing the value of GBTC shares as a convenient alternative to owning Bitcoin outright.
While BlackRock’s filing is a promising opportunity for investors, it also poses potential competition to Grayscale’s GBTC. Mark Yusko, founder of Morgan Creek, said that BlackRock’s application is a redeemable bitcoin trust that can directly compete with GBTC.
The development highlights growing interest from major players in the cryptocurrency industry as they seek to capitalize on expanding market demand for regulated bitcoin investment vehicles.
The SEC’s decision on BlackRock’s ETF application will be highly anticipated by market participants and cryptocurrency enthusiasts. A successful approval could pave the way for further institutional adoption and potentially open the floodgates for a new wave of investment in the cryptocurrency space.
As the cryptocurrency market continues to grow and mature, the launch of the Bitcoin Spot ETF will undoubtedly be a milestone event. It will provide investors with greater access to bitcoin and potentially improve overall market liquidity. Industry experts believe that the U.S. approval of a bitcoin ETF could have a transformative impact on the global cryptocurrency landscape.
The BlackRock ETF filing marks significant progress in an ongoing effort to bring a regulated bitcoin investment product to market. While it remains to be seen how regulators will respond to the application, the growing interest and support from major financial institutions suggests a shift in attitudes towards cryptocurrencies.
