BlackRock released important new information on Friday as part of its proposed spot Bitcoin ETF: the identities of the proposed authorized participants.
The asset management giant plans to add JPMorgan Securities and Jane Street as authorized participants if the Securities and Exchange Commission grants approval for its proposed fund, according to a filing Friday.
Authorized Participants, or APs, are companies that are permitted to create and redeem shares of an ETF. These organizations can either exchange ETF shares for a corresponding basket of securities reflecting the ETF's holdings or exchange them for cash.
ETF watchers like Bloomberg Intelligence analysts James Seyffart and Eric Balchunas have been closely watching new S-1s to figure out who is tapping which companies as APs. The disclosure is considered one of the final steps before the SEC can make its decision.
Balchunas said in a research note this week that the SEC is ready to approve spot Bitcoin ETF proposals that commit to all-cash creation and redemption and have signed agreements with authorized participants.
Read more: As the Bitcoin ETF saga reaches its home stretch, here are some things to keep in mind
Both Balchunas and Seyffart believe there is a 90% chance that the SEC will allow some companies to launch a spot Bitcoin ETF in early January. The regulator has a deadline of January 10 to decide on a proposal from Ark Invest and 21Shares, and could decide on similar plans by others by that date.
Ark and 21Shares and VanEck refiled their S-1s on Thursday and Friday, respectively. However, neither company has named APs. Companies are only required to appoint APs when they file the applicable prospectus.
“Essentially that means they can go live. [It’s] This should theoretically name an AP/underwriter (along with fees and other details),” said Seyffart said in a post on X.
Grayscale Investments should work with authorized participants Jane Street and Virtu Financial if its Grayscale Bitcoin Trust (GBTC) is allowed to convert into an ETF, a June 2022 Bloomberg report that a Grayscale spokesperson confirmed at the time.
The company did not name these companies as authorized participants in its most recent S-3 filing, and a Grayscale representative had no further comment.
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