In its latest filing with the U.S. Securities and Exchange Commission (SEC), BlackRock disclosed that an anonymous seed investor has committed to purchasing $100,000 worth of shares for the investment giant’s proposed bitcoin (BTC) exchange-traded fund (ETF).
The submission sheds light on the initial steps taken by the investment giant to secure funding for its forthcoming “iShares Bitcoin Trust.”
Seed Investor’s Contribution
The filing details that the undisclosed seed investor finalized an agreement to acquire $100,000 worth of shares on October 27, 2023. Consequently, on the same day, the investor acquired 4,000 shares at a per-share price of $25.00, officially referred to as the “seed shares.”
This seed capital serves as the crucial initial funding essential for an ETF to create the underlying creation units. While enabling the offering and trading of shares in the open market.
iShares Bitcoin Trust and Investment Strategy
BlackRock’s proposed “iShares Bitcoin Trust” distinguishes itself by intending to invest directly in bitcoin, rather than relying on futures contracts linked to the leading cryptocurrency. Among the 13 ETF applications currently awaiting regulatory approval, BlackRock’s initiative holds significance for its direct investment approach in the underlying asset.
SEC’s Potential Approval and Market Outlook
Market analysts anticipate the SEC to potentially approve one or more spot ETFs early in the upcoming year. Bloomberg analysts have placed a high probability of around 90% for such approvals, with January earmarked as a potential timeline for regulatory greenlighting.
Additionally, the anticipated approval of spot ETFs by the SEC is expected to pave the way for a new phase in the cryptocurrency market. Furthermore, it will offer investors more accessible avenues to gain exposure to digital assets like bitcoin through traditional investment vehicles.
Further, BlackRock acquisition of seed capital also marks an initial step in the process of establishing its proposed iShares Bitcoin Trust. The news further increased anticipation surrounding potential regulatory approval for spot ETFs in the cryptocurrency space.