Investment manager BlackRock has set its sights on a spot Bitcoin exchange traded fund (ETF), filing an application with the U.S. Securities and Exchange Commission (SEC) to launch the product on NASDAQ.
BlackRock’s iShares Bitcoin Trust would offer baskets of shares in multiples of 40,000 in exchange for the corresponding amount of Bitcoin, according to the application filed on Thursday.
BlackRock has partnered with Coinbase to act as the fund’s Bitcoin custodian and Bank of New York Mellon to custody the fund’s cash holdings.
The CME CF Bitcoin Reference Rate would be used to determine the value of Bitcoin in the fund each day. The benchmark index tracks the price of Bitcoin across several crypto exchanges, including Coinbase, Kraken and Gemini, and does not include any futures prices in its methodology.
Although the SEC has approved several Bitcoin Futures ETFs, backed by Bitcoin futures contracts monitored by the Chicago Mercantile Exchange (CME), the regulator is yet to approve a spot Bitcoin ETF.
However, this has not stopped a number of firms from making new attempts to launch a product that tracks the spot price of Bitcoin, including Grayscale which has resorted to suing the SEC over the agency’s denial to convert its flagship Bitcoin Trust into an ETF.
In the hour following news of BlackRock’s filing, the price of Bitcoin rose 1.5% to $25,700, recovering considerably after a sharp selloff earlier in the day.