Citi, Goldman Sachs, and Citadel join BlackRock’s Bitcoin ETF

BlackRock, the world’s largest asset manager, has expanded its roster of authorized participants for its iShares Bitcoin Trust ETF by adding four Wall Street giants.

Citi, Goldman Sachs, UBS, and Citadel have joined alongside JP Morgan and Jane Street, according to a recent amendment to the ETF’s Form S-1 filed with the Securities and Exchange Commission. These firms are tasked with acquiring the underlying assets of the ETF, in this case, bitcoin, to create and provide liquidity for the ETF’s shares.

An authorized participant plays a crucial role in the ETF industry, responsible for creating and redeeming ETF shares. This ensures that the ETFs trade closely with their underlying assets.

The introduction of these financial giants as authorized participants reflects the growing interest in cryptocurrency investments among mainstream financial entities. The precise date when these firms were officially recognized as authorized participants has not been disclosed, and BlackRock has not yet commented on the matter.

Speculation surrounds institutional involvement

Speculation arises regarding the timing of these firms’ public acknowledgment as authorized participants, with some suggesting a change in attitude towards the cryptocurrency sector. Eric Balchunas, a senior ETF analyst at Bloomberg, speculates that these institutions may have been quietly providing liquidity for the ETFs for some time but were reluctant to publicize their involvement due to the industry’s perceived stigma.

Balchunas indicated that the recent success of bitcoin and spot bitcoin ETFs may have contributed to a shift in perspective, making these firms more comfortable with their association with cryptocurrency investments.

The popularity of spot bitcoin ETFs has surged alongside the price of bitcoin itself, which climbed by over 40% since the approval of the first batch of spot bitcoin ETF applications. As of the latest reports, bitcoin is trading at $67,792, with the funds’ collective trading volume reaching $190 billion.