BlackRock, Nasdaq Meet SEC Again to Discuss Spot Bitcoin ETF

BlackRock and Nasdaq met the U.S. Securities and Exchange Commission (SEC)’s Division of Trading and Markets Tuesday to discuss the asset manager’s bid to launch a spot Bitcoin ETF.

According to a memo released by the SEC, the meeting included BlackRock’s Head of Digital Assets, Robert Mitchnick, along with personnel from the asset manager’s ETF team. Also participating were Nasdaq’s VP and Chief Regulatory Officer Joseph Cusick, Head of U.S. Equities and Exchange-Traded Products Giang Bui and Head of ETP Listings Alison Doyle. Heading up the SEC’s team were David Shillman and Eric Juzenas, Associate Directors in the regulator’s Division of Trading and Markets.

Per the memo, the discussion related to the Nasdaq’s “proposed rule change to list and trade shares of the iShares Bitcoin Trust under NASDAQ Rule 5711(d).”

Rule 5711(d) provides guidelines for the listing of Commodity-Based Trust Shares, and the criteria for initial and continued listing including compliance requirements.

The meeting comes on the heels of yesterday’s amendment to BlackRock’s S-1 application, in which its proposed iShares Bitcoin Trust gained a new ticker, IBIT, and switched to a cash-only ETF—meaning that new shares of the fund can only be created with cash, not Bitcoin.

It’s the latest in a series of meetings between BlackRock and the SEC regarding its Bitcoin ETF application. In November, the asset manager met the regulator to discuss a proposed rule change that would make it easier for Wall Street Banks to participate in the ETF, by shifting risk to crypto market makers.

BlackRock’s Bitcoin ETF application

BlackRock sent shockwaves through the crypto industry in June when it filed an application for a spot Bitcoin ETF. The entrance of the world’s largest asset manager into the race for a Bitcoin ETF reinvigorated hopes that the financial instrument would be approved by the SEC, after years in which the regulator had shot down every single application it received.

With a window looming in January 2024 during which the SEC could approve multiple applications simultaneously, the series of meetings between the regulator and applicants has sparked optimism that 2024 might be the year in which a spot Bitcoin ETF is finally approved in the U.S. Analysts from Bloomberg Intelligence and JP Morgan have argued that it’s likely at least one spot Bitcoin ETF will be approved in January 2024.

Many market observers expect a large influx of capital to flow into crypto as a result, though JP Morgan took a more cautious stance in its 2024 crypto outlook. The bank’s analysts argued that capital would likely move into spot Bitcoin ETFs from existing Bitcoin products such as the Grayscale Bitcoin Trust (GBTC), Bitcoin futures ETFs and Bitcoin mining companies.