BlackRock Spot BTC ETF Seed Funding is a Step Forward, but Just a Step

The move appears to be more for "operational purposes," said one ETF expert.

AccessTimeIconDec 6, 2023 at 4:54 p.m. UTC
Updated Mar 8, 2024 at 6:21 p.m. UTC

Asset manager BlackRock (BLK) turned some heads earlier this week when an updated prospectus for its spot bitcoin ETF application included a disclosure that it had collected $100,000 in seed capital for the fund.

Growing anticipation that U.S. authorities might soon approve one or more spot bitcoin ETF applications has been a sizable factor in the crypto's roughly 60% rally since Oct. 1, so market watchers have been on high alert for any signs of confirmation.

  • AI Tokens Surge as Nvidia Becomes World’s Most Valuable Company
    00:47
    AI Tokens Surge as Nvidia Becomes World’s Most Valuable Company
  • MicroStrategy Buys 11.9K More Bitcoin; SEC Ends Probe Into Consensys
    01:56
    MicroStrategy Buys 11.9K More Bitcoin; SEC Ends Probe Into Consensys
  • CoinFund President on Navigating the 'Macro Noise'
    17:16
    CoinFund President on Navigating the 'Macro Noise'
  • Has Crypto Become Political?
    00:51
    Has Crypto Become Political?
  • But just how big of a deal was BlackRock's disclosure this week? It was a positive step, suggested Bloomberg Intelligence ETF analyst James Seyffart, but only a step.

    “I suspect this is more for operational purposes and setting things up,” Seyffart said. “It’s meaningful," he added, "because it shows they are doing everything needed to launch but I don’t think it means much more than that.”

    It's common for ETF issuers to raise seed capital well ahead of the launch of new products, he reminded. Seyffart also noted that the $100,000 figure is a relatively small one – a more normal amount, he said, would be closer to a couple of million.

    Though the initial investment into the prospective fund isn’t as big of a deal as some made it out to be, it's still significant, said Seyffart, in that it shows BlackRock’s commitment to the fund.

    Current conventional wisdom is leaning towards an early January positive SEC decision on at least some of the 13 spot bitcoin ETF applications before the agency, BlackRock's among them.

    Seyffart and his colleague, Eric Balchunas believe there's a 90% chance of approval by Jan. 10, 2024.

    Edited by Stephen Alpher.

    Disclosure

    Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

    CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.

    Helene Braun

    Helene is a New York-based reporter covering Wall Street, the rise of the spot bitcoin ETFs and crypto exchanges. She is also the co-host of CoinDesk's Markets Daily show. Helene is a graduate of New York University's business and economic reporting program and has appeared on CBS News, YahooFinance and Nasdaq TradeTalks. She holds BTC and ETH.


    Read more about