Important crypto news for BlackRock, which recently had an arguably decisive closed-door meeting with the SEC to discuss the approval of the Bitcoin spot ETF.
See below for all the details.
ETF news: key meeting between BlackRock and the SEC, could this be the turning point for the crypto world?
As anticipated, according to recently emerged sources, BlackRock reportedly held a meeting with officials from the U.S. Securities and Exchange Commission (SEC) to explore the possibility of a Bitcoin-related spot exchange-traded fund (ETF).
Specifically, it is reported that the company presented in detail how it might adopt a similar cash or payment model, similar to that used for the iShares Bitcoin Trust.
Also on the same day, it was revealed that Grayscale, another company operating in the same industry, also held talks with the US Securities and Exchange Commission (SEC) regarding ETFs.
Grayscale has been in discussions with the SEC at a time when the market is grappling with continuous regulatory changes.
Despite the lack of an official announcement regarding the details of BlackRock’s submission to the SEC, it is known that the company is looking at different payment options for its Bitcoin ETF.
Currently, SEC officials have not made any official statements regarding the evaluation of these proposals.
Meanwhile, although the details of these much-anticipated meetings have not been officially disclosed, several sources and the opinions of some analysts suggest that the SEC is approaching the decision-making stage and that the likelihood of approval for applications for spot ETFs on Bitcoin is increasing.
However, it is essential to note that these predictions are currently based on speculation and not confirmed information.
All the details that have emerged about the meeting between BlackRock and the SEC: models and outlook
As anticipated based on what emerged, the main focus at the meeting was on the discussion regarding the iShares Bitcoin Trust and its possible pricing on Nasdaq as a spot Bitcoin exchange-traded fund (ETF).
The event was hosted by the SEC’s Trading and Markets Division and was attended by key figures including David Shillman, Tom McGowan, Randall Roy, and others.
On the BlackRock side, however, Rachel Aguirre, Adithya Attawar, Shannon Ghia, Robert Mitchnick, Charles Park, Marisa Rolland, and Ben Tecmire were present.
BlackRock’s presentation to the SEC detailed two potential models for the iShares Bitcoin Trust: the “in-kind redemption model” and the “cash redemption model.”
These models examined the ETF’s operational mechanisms, focusing on the redemption process involving market makers, Bitcoin custodians, and various exchanges.
In the in-kind redemption model, the ETF issuer orders the bitcoin custodian to issue bitcoin to a market maker, who can then liquidate the Bitcoin position.
This model involves several entities, including a U.S.-registered broker/dealer, spot cryptocurrency exchanges, and a price exchange.
In contrast, in the cash redemption model, the ETF issuer negotiates directly with the market maker to sell Bitcoin in exchange for USD.
This model includes additional steps involving the Bitcoin custodian in transferring the cash from the deposits and the market maker in delivering the shares to the transfer agent through an authorized participant.
Again, let us recall that the SEC’s response to BlackRock’s submission and proposed models remains unclear at this time, with no indication as to whether or not it will approve the price of a spot ETF on Bitcoin.
Regardless, we stress that approval of such an ETF would represent a significant step forward in the acceptance of cryptocurrency in major financial markets.
The false announcement regarding BlackRock and the alleged call for an XRP ETF
Recently, a post circulated online which claimed that BlackRock had requested an XRP spot ETF. This generated genuine chaos in the financial media.
In fact, following this news, the value of XRP rose more than 12% within about 20 minutes, from about $0.65 to $0.73.
However, the situation took a turn for the worse when more than $7 million was lost by futures traders in a single day after BlackRock denied the claims.
These statements had been cleverly spread on X (Twitter) by an individual who falsely presented himself as the company’s CEO.
Currently, the price of XRP stands at about just above $0.60.
Despite this, BlackRock maintains its focus on other ETFs, particularly Bitcoin and Ethereum, confirming the giant asset manager’s continued interest in the cryptocurrency sector.