BlackRock, the world’s largest fund manager, has received a significant boost in its preparations for a potential Bitcoin exchange-traded fund (ETF) launch. According to a recent filing, BlackRock secured $100,000 in seed funding from an investor who purchased shares from the iShares Bitcoin Trust on October 27.
In the context of ETFs, seed capital is an initial investment made by an investor to kickstart the fund and facilitate its introduction to stock exchanges. BlackRock’s move to gather seed funding indicates its active steps toward launching a Bitcoin ETF.
BlackRock, a prestigious Wall Street firm, has submitted an application to the U.S. Securities and Exchange Commission (SEC) for its spot Bitcoin ETF. Currently, the SEC is reviewing various applications for Bitcoin ETFs from different entities.
An ETF, or exchange-traded fund, enables investors to acquire shares that mirror the price movements of an underlying asset, such as gold, foreign currencies, or, in this case, cryptocurrency. A spot Bitcoin ETF holds actual Bitcoin, providing investors with direct exposure to the digital asset.
The SEC has historically rejected applications for spot Bitcoin ETFs, citing concerns about potential market manipulation. However, BlackRock’s application in June marked a significant development, as it signaled traditional investors’ interest in gaining exposure to cryptocurrencies. The announcement had a notable impact on Bitcoin’s price, reflecting the market’s positive response to the news.
BlackRock CEO Larry Fink, a billionaire, further supported Bitcoin in public interviews, describing it as an “international asset” and likening it to “digitizing gold.” With the recent seed funding and growing interest in cryptocurrency exposure, analysts speculate that the SEC might approve a spot Bitcoin ETF for trading in January, potentially opening new avenues for mainstream investment in the crypto market.
