SEC Formally Accepts BlackRock Spot Bitcoin ETF Application for Review

The procedural move suggests that the federal agency will give the closely-watched application a serious look.

By Ryan Ozawa

Image: Tada Images/Shutterstock.com

BlackRock's application to offer a spot Bitcoin exchange-traded fund (ETF) has been added to the official docket of the Securities and Exchange Commission as part of its proposed rule change process. The move, recorded late Thursday, advances the most closely-watched Bitcoin-related proposal to the SEC to date.

The application for the iShares Bitcoin Trust was filed nearly a month ago, prompting a new wave of optimism across the crypto market, and additional filings for spot Bitcoin ETFs from a number of other prominent players, including from firms like Invesco, Wisdom Tree, Bitwise, and Fidelity—which saw its previous application rejected last year along with those from other contenders.

When the SEC signaled last month that BlackRock's application was lacking, the company filed a revised application, adding a "surveillance sharing" clause that would involve the Coinbase crypto exchange monitoring and reporting possible illegal activity.

Soon enough, Valkyrie updated its application with the same provision, as did Fidelity and ARK Invest.

A spot Bitcoin ETF would track the value of Bitcoin without requiring the asset to be held directly. It would also be tradable on a traditional stock exchange.

While a Bitcoin ETF based on Bitcoin futures launched to great fanfare earlier this year, a spot ETF—which is tied to the current price of the cryptocurrency—has been described as a "holy grail" for the industry. The SEC's continued resistance to approving one over the past several years has been described as a "complete and utter disaster."

With BlackRock's application now on the SEC's official calendar, it will be published in the Federal Register and trigger a 21-day public comment period.

Meanwhile, four other applications were docketed on Friday related to the Cboe BZX Exchange, which was the first entity to apply for a Bitcoin ETF in March 2021, They include the Wise Origin Bitcoin Trust, WisdomTree Bitcoin Trust, VanEck Bitcoin Trust, and Invesco Galaxy Bitcoin ETF, which will also enter a three-week comment period.