BlackRock Files for Spot Bitcoin ETF, with Coinbase as Crypto Custodian

Asset management giant BlackRock took the first steps Thursday to launch a spot bitcoin exchange-traded fund, which has long been a point of contention between crypto advocates and federal regulators.

The firm filed an application with the U.S. Securities and Exchange Commission to launch the iShares Bitcoin Trust. If approved, the ETF would allow easy access for investors to get exposure to crypto in a product from one of Wall Street’s largest companies.

The SEC has so far resisted allowing the launch of a spot bitcoin ETF in the U.S. The regulator is currently in a legal battle with Grayscale over whether the firm will be allowed to convert its Grayscale Bitcoin Trust into an ETF. A decision in that case is expected later this year.

Several other firms have filed and later pulled applications to launch spot bitcoin funds. If the SEC relents, there could be a flood of those products on the market.

BlackRock's move comes during a time when crypto prices remain well below their all-time highs and the industry faces increasing scrutiny in Washington, D.C.

The SEC recently sued Coinbase and Binance for allegedly running unregistered securities exchanges. The SEC also accused Binance of commingling customer funds with its own.

Coinbase is listed as the bitcoin custodian for the proposed BlackRock ETF. BlackRock has an existing strategic partnership with Coinbase. The companies announced last year that Aladdin, BlackRock's institutional investment platform, would be connected to Coinbase Prime for crypto trading and custody.

(Source: CNBC)