December 6, 2023

BlackRock’s bitcoin spot ETF is unlikely to launch anytime soon because of SEC Chairman Gary Gensler’s stance on cryptocurrencies, trading firm QCP Capital said.

The SEC has taken an increasingly hostile stance towards the crypto ecosystem under Gensler.

BlackRock spot ETFs give SEC headache

Recently, there have been multiple applications for spot bitcoin exchange-traded funds (ETFs). However, all of these were rejected by the U.S. Securities and Exchange Commission (SEC), the regulator responsible for approving exchange-traded funds. BlackRock, the world’s largest asset manager, is the latest to file for a bitcoin spot ETF. While there was optimism that BlackRock’s spot bitcoin ETF application could be the first to be approved, analysis by trading firm QCP Capital has dampened that optimism.

According to QCP Capital’s assessment, a spot bitcoin ETF, whether it’s BlackRock or any other company, is unlikely to appear in the near future, mainly due to the fact that SEC Chairman Gary Gensler and his A tough stance on cryptocurrencies. The QCP added that while institutional participation and interest in Bitcoin will certainly increase, the current makeup of the SEC means that spot ETFs are unlikely to be approved.

black stone The spot ETF was filed earlier this month, with Nasdaq filings showing that Coinbase Custody Trust will be the custodian for the fund’s bitcoin holdings, while BNY Mellon will be the fund’s fiat currency custodian. people.

Obstacle named Gensler

Complicating the situation is current SEC Chairman Gary Gensler, who has taken a hostile stance on cryptocurrencies in general. Under his leadership, the SEC has launched multiple lawsuits against major cryptocurrency exchanges. These include Binance and Coinbase, the world’s largest cryptocurrency exchanges. QCP Capital wrote in its evaluation:

“However, with Gensler in charge of the SEC, we are not confident that ETFs will actually get approved in the near term. Nevertheless, as we have always maintained, institutional BTC and ETH have a huge presence in the asset management space, and in the next In the months and years we will see further steps in this direction.”

QCP Capital’s observation is interesting, especially because it highlights that BlackRock had received only one rejection out of a total of 576 previous applications.

Grayscale Bitcoin Trust Bounces Back

The ripple effect of the BlackRock Spot Bitcoin ETF has been reflected in the price performance of Bitcoin (BTC), among other things. Grayscale Bitcoin Trust (GBTC) has staged a sharp recovery after bitcoin fell nearly 50% against the dollar and continues to rise as it recovers lost ground. According to data from CoinGlass, Grayscale Bitcoin Trust’s discount to BTC spot (net asset value discount) reached the lowest level in 2023, at 33.45%. According to QCP, the Grayscale Bitcoin Trust has seen its biggest recovery since the end of 2020.

Disclaimer: This article is for informational purposes only. It does not provide or be intended to be used as legal, tax, investment, financial or other advice.