Bitcoin, the largest cryptocurrency by market capitalization, has recovered from a sharp drop below $25,000 and climbed back above $26,000 on Friday. The rally was fueled by the news that BlackRock, the world’s biggest asset manager, had filed for a spot-Bitcoin exchange-traded fund (ETF) with the US Securities and Exchange Commission (SEC).
A spot-Bitcoin ETF would allow investors to directly buy and sell Bitcoin through a regulated platform, without having to deal with intermediaries or custody issues. This could potentially boost the demand and adoption of Bitcoin among institutional and retail investors, as well as increase its liquidity and price discovery.
BlackRock’s filing comes amid a series of rejections by the SEC of previous proposals for Bitcoin ETFs, mainly due to concerns over market manipulation, fraud and investor protection. However, some analysts believe that the regulator may be more open to approving a spot-Bitcoin ETF than a futures-based one, as the latter involves more complexity and risk.
BlackRock is not the only firm that is pursuing a spot-Bitcoin ETF in the US. Earlier this week, Valkyrie Investments also filed for a similar product with the SEC, while VanEck and WisdomTree have pending applications for Bitcoin futures ETFs.
Meanwhile, other cryptocurrencies also followed Bitcoin’s uptrend on Friday, with Ethereum rising above $1,700, Binance Coin above $237 and XRP above $0.47. The total market capitalization of all cryptocurrencies increased by more than 2% to reach $1.1 trillion.
