Following BlackRock’s move, a series of traditional financial giants have started filing applications to register Bitcoin Spot ETFs. This raises the question: “What makes Bitcoin Spot ETFs so appealing to these giants, or is there any other hidden agenda?”
On June 15th, the world’s largest asset management company, BlackRock, filed an application to register the first Bitcoin Spot ETF in the US called iSHARES BITCOIN TRUST. Following suit, several other traditional financial giants such as Fidelity, WisdomTree, Valkyrie Investments, Bitwise Asset Management, etc., also joined BlackRock. Notably, this is the fourth time that WisdomTree, with $87 billion in assets under management, has submitted a registration application for a Bitcoin Spot ETF. The previous three attempts were all rejected by the SEC.
Many believe that these giants have recognized the potential and underlying power of cryptocurrencies, which have the ability to disrupt the global economy.
Some skeptics suspect that Wall Street and US regulatory agencies are collaborating to take control of the crypto market. The SEC’s crackdown on two leading exchanges, Binance and Coinbase, is seen as a strategic move to pave the way for US financial companies.
The primary reason is likely profitability. The big players want to generate profits, and launching Bitcoin Spot ETFs is the best way to capitalize on the market without worrying about legal violations, as they have government backing.
A Bitcoin ETF is a collection of assets that are tied to the price of BTC. These assets are purchased, securitized, and traded on traditional exchanges instead of cryptocurrency exchanges.
Unlike Bitcoin futures ETFs, which are based on contracts executed at future prices of BTC, a spot Bitcoin ETF will rely on the current price of Bitcoin, reflecting its current market capitalization.