Institutional players have been trying to strengthen their position in the cryptocurrency market throughout the year. As the year comes to a close, leading firms are making even more significant strides.
BlackRock is the latest firm to take yet another important step in the race for the inception and adoption of Cryptocurrency Spot Exchange Traded Funds (ETFs). With around $9.4 trillion in total assets under management (AUM), the asset management giant filed for an Ethereum Spot ETF.
As explained in the filing, the investment firm requests that the “Trust” in its previously filed ETF be converted to a Spot ETF. This means that BlackRock’s futures products will be replaced with Ether products, which will be tied to the token.
Registered a week ago, the iShares Ethereum Trust will go live on Nasdaq after it receives approval from regulators.
A significant number of industry experts have since emphasized the significance of BlackRock’s move. These figures have collectively asserted that although a Bitcoin ETF might struggle to enter the U.S. market, an Ethereum ETF is more likely to gain approval swiftly.
Notably, Ether, the second most valuable cryptocurrency by market cap, is regarded by many as Bitcoin’s biggest rival. The asset, valued at $2,043 at press time, is expected to dethrone Bitcoin long-term.
Once approved, BlokckRock’s Ethereum ETF will allow interested cryptocurrency investors to gain access to Ether without directly owning the asset.
Meanwhile, the U.S. Securities and Exchange Commission has expressed displeasure towards Spot ETFs. The regulator has maintained that the product is susceptible to fraud and market manipulation. It has, however, approved futures-based crypto ETFs in the past.
It bears mentioning that the Federal Appeals court had previously ruled against the SEC in its legal battle with the SEC. In August, the court ruled against the SEC’s decision to reject a Bitcoin spot ETF from Grayscale Investments, a prominent digital asset manager.
As advised by other key figures, BlackRock is taking precautionary steps to avoid pushbacks and sanctions from the regulator. Excerpts of the filings stated that the information detailed in the prospectus has not been completed and is still subject to change.
“These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities, and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.” BlackRock wrote.