A new ticket has been chosen by BlackRock for its iShares Bitcoin ETF, a detail that was revealed in an amendment to the S-1 application the asset manager had submitted.
The amendment was filed a day earlier with the SEC and the filing also reveals that other than the new ticket IBIT, the ETF will now just be cash-only.
The amendment
This means that only cash will be used for creating new shares of the fund and not Bitcoin. This change had been foreshadowed in the minutes released last week by the SEC.
This was after the security agency had had a meeting with executives of Nasdaq and BlackRock due to which it was not surprising, or unexpected.
During an ETF webinar on Tuesday, Eric Blachunas, a Bloomberg Intelligence analyst, said that the SEC was unlikely to be comfortable the previous way.
It was because it would have enabled registered brokers to use Bitcoin, which is not permitted. He added that the regulator does not want unregistered subsidiaries to use Bitcoin.
This problem would be solved with cash creation, as it would mean that Bitcoin is only used by the issuer and no one else.
The possibility
Even though it does not seem like a lot, it is yet another signal that things are moving in favor of BlackRock.
It also indicates that analysts’ expectations that the SEC would make history with the approval of the first Bitcoin ETF in the United States may also be correct.
For a while, it had seemed that BlackRock’s Bitcoin ETF would trade under the IBTC ticker, but that had turned out to be false.
It happened in late October when the ticker had appeared on a list maintained of pre-launch and active funds by the Depository Trust & Clearing Corporation (DTCC).
The mentioned ticker can still be found on the page’s archived version.
The SEC
The Securities and Exchange Commission (SEC) has been repeatedly rejecting applications for a spot Bitcoin ETF for quite some time.
This investment product is under the ETP umbrella, but it is different because a spot Bitcoin ETF tracks the price of Bitcoin in real-time, which futures Bitcoin ETFs do not.
According to the securities regulator, there is just too much volatility in the crypto markets and also a risk of market manipulation due to which they do not approve a spot Bitcoin ETF.
However, the previous cycle of delays by the agency was accompanied by feedback and meetings and this led to anticipation that an approval might be granted.
If the SEC does approve, most market observers believe that the crypto market would experience a large inflow of capital.
One of the prerequisites for trading on an exchange is to get a ticker registered with the clearing and settlement firm.
But, the IBIT ticker has not made it to the list currently. The IBTC ticker had been deemed unsuitable because BlackRock is already using the same for one of its European products.