According to CoinDesk, asset manager BlackRock recently updated its prospectus for its spot bitcoin ETF application, disclosing that it had collected $100,000 in seed capital for the fund. This news has generated interest as the anticipation of U.S. authorities approving one or more spot bitcoin ETF applications has been a significant factor in the cryptocurrency's approximately 60% rally since October 1. However, Bloomberg Intelligence ETF analyst James Seyffart suggests that BlackRock's disclosure is a positive step, but only a step.
"I suspect this is more for operational purposes and setting things up," Seyffart said. "It’s meaningful because it shows they are doing everything needed to launch, but I don’t think it means much more than that." He also noted that it is common for ETF issuers to raise seed capital well ahead of the launch of new products and that the $100,000 figure is relatively small compared to the more typical couple of million dollars.
Despite the initial investment not being as significant as some may have thought, Seyffart believes it still demonstrates BlackRock's commitment to the fund. Currently, the consensus is that the SEC will make a positive decision on at least some of the 13 spot bitcoin ETF applications, including BlackRock's, by early January. Seyffart and his colleague, Eric Balchunas, estimate a 90% chance of approval by January 10, 2024.
