The iShares Bitcoin Trust Amends S-1 Filing, Indicates Nasdaq Trading

The iShares Bitcoin Trust Amends S-1 Filing, Indicates Nasdaq Trading

BlackRock, one of the leading asset managers, has submitted a new amendment to its S-1 filing for the iShares Bitcoin Trust. This recent filing introduces several changes, including the addition of a market ticker and updates on transaction models. The company’s intention to trade on the Nasdaq is now indicated, reflecting their evolving discussions with the U.S. Securities and Exchange Commission (SEC). This article delves into the details of the amended filing and the potential implications for the Bitcoin ETF.

In a departure from its previous filing, BlackRock’s latest amendment boldly adds a market ticker, IBIT, for the iShares Bitcoin Trust. By including this ticker, it becomes clear that the fund aims to trade on the Nasdaq under this label. The previous filing used a vacant field as a placeholder for the ticker, but this amendment provides greater certainty about BlackRock’s intentions regarding the trading platform.

The amended filing highlights changes in the iShares Bitcoin Trust’s transaction models. While earlier amendments indicated that the trust would issue and redeem shares in blocks of 40,000 (referred to as “baskets”) involving Bitcoin transactions, the latest amendment introduces the possibility of transactions occurring in exchange for cash. However, Bitcoin transactions remain a potential option. BlackRock has mentioned that if Nasdaq receives the necessary regulatory approval, the trust may also perform in-kind creations and redemptions involving Bitcoin. These updates demonstrate the company’s adaptive approach to transaction models to meet regulatory requirements and market demands.

One notable addition to BlackRock’s current amendment is the introduction of the “Directed Trade Model.” This term refers to the purchase, sale, or settlement of Bitcoin between the trust and various counterparties. The inclusion of this model suggests that BlackRock is exploring alternative avenues for executing trades and aims to provide more flexibility in its operations within the Bitcoin ecosystem.

In addition to the significant changes mentioned above, BlackRock’s amendment also includes smaller additions to the filing. One such addition clarifies that the shares of the iShares Bitcoin Trust do not represent interests in or obligations of the fund’s cash custodian (Bank of New York Mellon) and the Bitcoin custodian (Coinbase Custody). This distinction provides greater clarity for potential shareholders and separates the responsibilities of the custodians from the fund itself.

Furthermore, the amended filing discusses risks associated with the CF Benchmark Index, which determines the trust’s net asset value (NAV). It emphasizes that system failures and errors at CF Benchmarks Ltd. could lead to losses and costs borne by the trust and its shareholders. This heightened awareness of potential risks showcases BlackRock’s commitment to transparency in its filing and the need for investors to consider all aspects before making investment decisions.

BlackRock, along with other asset managers, is vying to offer the first spot Bitcoin ETF in the United States. While awaiting approval from the SEC, experts in the industry are optimistic about the ETF gaining approval. Bloomberg ETF applicants Eric Balchunas and James Seyffart estimate a 90% chance of approval by Jan. 10, 2024. This positive outlook underscores the growing interest and potential for the iShares Bitcoin Trust to bring cryptocurrency exposure to traditional investment portfolios.

BlackRock’s recent amendment to the S-1 filing for the iShares Bitcoin Trust unveils several updates and additions. From the inclusion of a market ticker and changes in transaction models to the introduction of the Directed Trade Model, these amendments demonstrate BlackRock’s adaptability and commitment to navigating the regulatory landscape. As the company steers closer to potential approval for its Bitcoin ETF, market participants eagerly await the SEC’s decision and the ensuing impact on the cryptocurrency industry and traditional investment landscape.

Regulation

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