Wall Street and traditional finance institutions have shown a growing interest in cryptocurrencies, leading to a push for Bitcoin Exchange Traded Funds (ETFs) within the $7 trillion ETF industry. These instruments would facilitate direct holding of Bitcoin, an idea that has caught the attention of asset management giants such as BlackRock (NYSE:BLK), Fidelity, and WisdomTree.
In response to this interest, these firms have submitted applications for their own Bitcoin ETFs. To address the Securities and Exchange Commission’s (SEC) concerns about volatility, value verification, and potential fraud in the crypto market, BlackRock has proposed surveillance-sharing agreements. Coinbase (NASDAQ:COIN), a prominent cryptocurrency exchange platform, has emerged as a preferred partner for these efforts.
However, the SEC‘s stance on spot Bitcoin ETFs, which involve actual buying or selling of Bitcoin, remains uncertain. The regulator has approved futures-backed Bitcoin ETFs like the ProShares Bitcoin Strategy ETF but has denied spot ones.
Following the U.S.’s example, Canada introduced its Purpose Bitcoin ETF. Investment trusts are also looking to join the sector. Grayscale successfully transformed into an ETF despite SEC opposition, marking another significant development in this space.
