BlackRock makes significant adjustments ahead of the expected launch of the BTC ETF

In a new SEC filing, BlackRock said its iShares BTC trust will allow only cash creation instead of spot and changed its ticker symbol to IBIT.

BlackRock has chosen a new ticker symbol for its iShares BTC Trust: IBIT. This new detail appeared in the amendment to the asset manager’s S-1 application filed with the SEC, which was filed yesterday. In addition to this, the documents show that the ETF will only accept cash.

This means that new shares of the fund can only be created through cash, not BTC. The change was foreshadowed in documents last week following the SEC’s meetings with BlackRock and Nasdaq executives.

Bloomberg analyst Eric Balchunas said in an ETF webinar on Tuesday: “The SEC isn’t too happy with spot creation because it allows registered brokers to use BTC, which is not allowed.” I don’t think they want any unregistered subsidiary to be exposed to BTC. Cash creation solves this problem, which means that basically only the issuer has access to BTC, and others don’t. ”

While this may seem unremarkable, it is yet another reminder that things are moving in the right direction for BlackRock, and market analysts’ expectations that the SEC may approve the first BTC ETF in the United States, making history, may indeed come true.

For a while, iShares BTC Trust will be traded under the IBTC ticker symbol. This is because in late October, the fund appeared on the list of active and pre-issued funds maintained by the Depository Trust and Clearing Corporation (DTCC). In fact, it is still visible on the archived version of the page.

An exchange-traded product is an investment vehicle in which its shares are listed on an exchange. Exchange-traded products track underlying assets, such as BTC and ETH, or benchmarks such as commodities, currencies, stocks, and bonds.

Exchange-traded funds (ETFs) are a type of exchange-traded product, but there is one important difference: a spot ETF will track the real-time price of a BTC, which is not possible with BTC ETFs that are currently approved.

The U.S. Securities and Exchange Commission has consistently maintained that there is too much volatility and risk of manipulation in the cryptocurrency market to allow spot BTC ETFs to be traded in the United States. However, the SEC’s past series of delays have been accompanied by regulatory meetings and feedback, raising market expectations that it may eventually be approved. If approved, most market watchers expect a significant flow of money into the crypto space.

Obtaining a ticker symbol registered with a clearing and clearing firm is an important prerequisite for trading on an exchange. However, the IBIT ticker symbol is not currently on the current list.

Somewhat troublingly, IBIT used to be the same ticker symbol used by the issuer Defiance ETF for its Daily Short Digital Economy ETF, which the fund said in a press release allows investors to “hedge against the crypto industry.” The ETF was launched in September 2022 and closed a year later.

But there’s a reason why IBTC isn’t the ideal ticker symbol for BlackRock’s new BTC offering. Balchunas, an analyst at Bloomberg, noted that BlackRock has already used IBTC in one of its products in Europe.

He wrote on X (formerly Twitter) that "$IBIT can be recovered through liquidated Defiance ETFs. It’s just as sober and baby-boomer-friendly as IBTC. ”