Last week’s application for a spot Bitcoin exchange-traded fund (ETF) from investment giant BlackRock has inspired at least two investment funds to reopen their efforts, and submit their own filings to the U.S. Securities and Exchange Commission (SEC).
Major investment manager Invesco — which has around $1.4 trillion in assets under management — became the most recent firm to request the SEC’s approval for its own spot Bitcoin ETF on 21 June. The firm had originally filed for a Bitcoin ETF together with Mike Novogratz’s Galaxy Digital in 2021, but later abandoned the effort after several other Bitcoin ETF applications were rejected by the SEC.
Invesco’s new application requests that the regulator allows it to list its “Invesco Galaxy Bitcoin ETF” product on the Cboe BZX exchange, arguing that the lack of spot Bitcoin ETF was pushing investors towards riskier alternatives. The application also addressed the SEC’s concern for a potential market manipulation, noting that approval for a spot Bitcoin ETF depended on a “surveillance sharing agreement” with a major regulated market.
The surveillance sharing agreement allows for the exchange of information regarding market trading activity, clearing activity, and customer identification, which significantly reduces the potential for market manipulation. BlackRock also advocated for a surveillance sharing agreement in its application last week, arguing that NASDAQ could be used to fill in this role.
New York-based asset management fund WisdomTree — which oversees around $83 billion in assets — filed its own application for a spot Bitcoin ETF only hours before Invesco, requesting that its “WisdomTree Bitcoin Trust” is allowed to list on the Cboe BZX Exchange under the “BTCW” ticker. The SEC had rejected the firm’s ETF applications two times in the past — in December 2021, and October 2022 respectively — due to concerns of fraud and market manipulation. Similarly to BlackRock and Invesco, WisdomTree said it also intends to enter into a surveillance sharing agreement with “an operator of a US-based spot trading platform for Bitcoin”.
All these spot Bitcoin ETF applications were spurred by BlackRock, the largest investment firm in the world, which last Thursday surprised the market with its own filing. Bloomberg’s senior ETF analyst, Eric Balchunas, noted that crypto investors had a good reason to be optimistic about this particular spot Bitcoin ETF application, considering BlackRock had a “575-1” record of getting its ETFs approved by the regulator.