TL;DR Breakdown
- Bloomberg senior ETF analyst Eric Balchunas gives BlackRock a 50-50 chance of getting its BTC ETF approved by American financial regulators.
- Balchunas’ prediction follows Bloomberg Intelligence senior litigation analyst Elliott Stein’s assessment that Grayscale has a 70% chance of winning its case against the SEC.
- Balchunas says that the SEC might view BlackRock’s ETF filing positively as a chance to “save face” following the recent crypto crackdown.
Description
According to Bloomberg senior ETF analyst Eric Balchunas, investment management giant BlackRock has a 50% probability of getting its spot Bitcoin Exchange Traded Fund (ETF) approved. The approval of BlackRock’s Bitcoin ETF could mark a groundbreaking moment for the cryptocurrency industry. As the world’s largest asset management firm, BlackRock’s foray into the realm of digital … Read more
According to Bloomberg senior ETF analyst Eric Balchunas, investment management giant BlackRock has a 50% probability of getting its spot Bitcoin Exchange Traded Fund (ETF) approved. The approval of BlackRock’s Bitcoin ETF could mark a groundbreaking moment for the cryptocurrency industry.
As the world’s largest asset management firm, BlackRock’s foray into the realm of digital assets signals a shifting tide of institutional acceptance and mainstream adoption.
BlackRock’s Bitcoin ETF prospects look promising
Eric Balchunas is a Senior ETF Analyst at Bloomberg Intelligence, where he is in charge of ETF and passive fund research and contributes to Bloomberg Opinion. He is a frequent speaker at industry events and conferences, and he co-created the Bloomberg podcast Trillions and Bloomberg TV’s ETF IQ. Additionally, Eric wrote The Institutional ETF Toolbox.
Balchunas’ prediction follows an observation made by Elliott Stein, a senior litigation analyst for Bloomberg Intelligence, who now believes Grayscale has a 70% probability of winning its case against the SEC.
Balchunas explained that the SEC might view BlackRock’s ETF filing positively as a chance to “save face” by authorizing an ETF from a “trusted ‘adult’ TradFi” firm rather than Grayscale. Eric Balchunas said that:
Another reason we give spot bitcoin ETF approval 50% chance is our senior legal analyst @NYCStein gives Grayscale a 70% chance of winning case against SEC, who could approve BlackRock’s ETF as way to save face using trusted ‘adult’ TradFi cos & stick it to Grayscale via @JSeyff.
Eric Balchunas
As the world’s largest asset manager, BlackRock would provide much-needed legitimacy to the Bitcoin market. Between the SEC’s crackdown on high-fee, flawed Bitcoin ETFs now on the market and an iShares spot Bitcoin ETF, an iShares spot Bitcoin ETF would be a welcome facelift. Whether this indicates that investors ought to buy this fund upon its market launch is another matter.
Grayscale’s GBTC becomes a heavy conversation
Since Grayscale filed an appeal against the United States Securities and Exchange Commission’s decision to deny its application in June 2022, the two sides have exchanged legal files in addition to oral testimony heard by three U.S. federal appellate court judges on March 7.
Elliott Stein, a senior litigation analyst for Bloomberg Intelligence, said that “Grayscale has a 70% chance of winning its lawsuit against the SEC over the company’s bid to convert the Grayscale Bitcoin Trust (GBTC) to a Bitcoin ETF, we believe.”
According to Stein, Grayscale’s odds climbed from 40% to 70% after the parties’ oral arguments came to an end because “all three judges on the panel appeared to side with Grayscale” based on their “lines of questioning.”
According to Stein, Bloomberg estimates a decision by August. Applications for Bitcoin ETFs have been a primary focal point for the sector recently, with Fidelity, Invesco, Wisdom Tree, and Valkyrie joining the $10 trillion asset management behemoth BlackRock in line for SEC clearance.
If the SEC finally approves applications from banks such as JPMorgan, Morgan Stanley, Goldman Sachs, BNY Mellon, and Bank of America to provide similar services, the digital asset market will be accessible to firms with a combined $27 trillion in assets under management.
Google Finance reports that the price of GBTC has increased by over 134% in 2023 to $19.47, marking its highest level since approximately May 13, 2022. GBTC’s price has fallen by over 65% from its all-time high of $56.70, in line with the majority of the crypto market.
YCharts data indicates that the discount between GBTC’s share price and its overall net-asset value decreased to 31% on June 26, the lowest level since September 12 of last year. A decrease in the discount rate for the trust suggests that investor sentiment toward the product may be improving.
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