2023-10-22 02:00:00
Like other major players such as ARK Invest and Fidelity, BlackRock updated its spot Bitcoin ETF (Exchange Traded Fund) application by carefully following the advice and recommendations of the American regulator SEC (Securities and Exchange Commission). The company thus shows its interest in this market and demonstrates its intention to enter it.
SEC vs. ETF: a standoff that has lasted for several years
The SEC displays an obvious desire to continually delaying the approval of spot Bitcoin ETFs. However, it recently suffered a scathing defeat in the Grayscale Bitcoin Trust conversion case. A federal court ordered the regulator to review its copy following its rejection. And in order to speed things up a little, the company Grayscale is back with an abbreviated version of its application file.
Growing interest from large investors in Bitcoin ETFs
These movements show that Bitcoin ETFs are attracting growing interest among large investors, despite the resistance encountered by regulators. Cathie Wood, CEO of the ARK Invest fund, for example, confirmed that there is indeed a change in behavior within the SEC with regard to requests for spot Bitcoin ETFs.
???? According to Bloomberg Intelligence, there is a 90% chance of approval of a spot Bitcoin ETF by January 10, 2024 ????
It would allow us to celebrate the future new year in style… ???? pic.twitter.com/8d95tboEE1
— Tagado Bitcoin & Crypto (@TagadoBTC) October 19, 2023
BlackRock and Grayscale: a common fight against the SEC
Grayscale took bold steps in engaging the SEC on legal grounds after its application was initially rejected. This strategy led to a federal court-mandated reevaluation, putting the SEC in a position where it must reconsider and clarify the specific reasons for its initial denial. For his part, BlackRock is also preparing to take on the SEC in the race for Bitcoin ETFs. Like ARK Invest and Fidelity, BlackRock wishes to put all the chances on its side by scrupulously following the recommendations of the American regulator.
Why is the SEC slowing down the approval of Bitcoin ETFs so much?
There may be several reasons for the SEC’s reluctance to quickly approve Bitcoin ETFs. First of all, regulators are concerned about the level of investor protection, particularly in terms of fraud and market manipulation. Then there is also liquidity and volatility issues linked to the underlying assets which are cryptocurrencies. Finally, the SEC also undoubtedly fears that this approval will open the way to a multitude of similar requests, making it more difficult to regulate the entire market.
What impact on the price of BTC?
This major news could well influence the price of Bitcoin which is currently at $29.725.
Back above $50,000?
Matrixport, a research company, has just shared its views on the matter. Their analysis suggests that Bitcoin could rise from $42,000 to $56,000 if the SEC approves this new ETF. They believe current investors in gold ETFs may be tempted to allocate 10-20% of their assets to Bitcoin, seeking to diversify their portfolio. If this happens, Bitcoin would benefit from a large injection of liquidity.
“Let’s imagine that 10-20% of current investors in gold ETFs decide to add some Bitcoin to their mix. This could mean an influx of $12 billion to $24 billion into Bitcoin. »
Although the SEC continues to put the brakes on the arrival of Bitcoin ETFs, the combined efforts of BlackRock, Grayscale and other major players could ultimately bear fruit. An approval of Bitcoin ETFs would then be a major turning point for the cryptocurrency industry and would contribute to their widespread adoption.
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