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One of the biggest news of the week was the move by American multinational investment management firm BlackRock to file for a spot Bitcoin Exchange Traded Fund (ETF) with the United States Securities and Exchange Commission (SEC). The news has fueled mixed reactions in the industry with experts sharing both positive and negative sentiments about the move.
BlackRock Filing May Benefit Grayscale
Amid the broad based regulatory uncertainty in the digital currency ecosystem in the United States, many are projecting that the BlackRock Bitcoin ETF product, if approved, will set a major precedent for the industry, a record that top market analyst Adam Cochran believes will be more beneficial to the Grayscale Bitcoin Trust (GBTC).
If the Blackrock ETF does get approved, the real winner here is going to be $GBTC
Because Blackrock will show the path to conversion, and GBTC's 40%+ discount will resolve on top of industry growth.
Imagine Barry is praying to every deity in every religion right now. pic.twitter.com/IHfjiFbOuv
— Adam Cochran (adamscochran.eth) (@adamscochran) June 16, 2023
The rationale is very obvious as Grayscale has made an attempt to convert its Bitcoin Trust product to a full fledged spot Bitcoin ETF product, a proposal the SEC blatantly rejected.
While in reality, the BlackRock filing is technically a Trust which will function like a Bitcoin ETF, its approval will set the tone for Grayscale to double down on its case as it dragged the markets regulator to court following the refusal of the GBTC conversion to Bitcoin ETF.
Stretching the context of the benefits, Adam noted that the approval for BlackRock’s filing “will show the path to conversion, and GBTC’s 40%+ discount will resolve on top of industry growth.”
While highlighting Grayscale as one of the prospective beneficiaries, the major hurdle experts have been debating is whether or not the US SEC will approve the application or not. Adam is convinced that BlackRock CEO, Larry Fink has deep ties within the Democratic Party and as such, he may have the upper hand to get the market regulator to approve the product.
Banking on BlackRock’s Records
BlackRock is arguably one of America’s largest financial institutions which boasts of about $10 trillion in Assets Under Management (AUM). As reported earlier by CoinGape, the company has about a 99% success rate when its previous applications for Exchange Traded Funds (ETF) are brought into focus.
By banking on his success rates over the years and the influence of the company and its CEO, the industry is anxious that the first spot Bitcoin ETF may be on its way.
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