BlackRock’s amended spot Bitcoin ETF plea includes cash redemptions

The world’s biggest asset manager BlackRock has filed a revised spot Bitcoin exchange-traded fund proposal to enable smooth cash redemptions, a step that might help the company obtain approval from the US Securities and Exchange Commission.

“The trust issues and redeems baskets on a continuous basis,” BlackRock’s iShares Bitcoin Trust said in a regulatory filing. “These transactions will take place in exchange for cash. Subject to the in-kind regulatory approval, these transactions may also take place in exchange for bitcoin.

“Baskets are only issued or redeemed in exchange for an amount of cash determined by the trustee on each day that Nasdaq is open for regular trading. No shares are issued unless the Bitcoin custodian or prime execution agent has allocated to the trust’s account the corresponding amount of Bitcoin.”

In June, BlackRock filed for a spot Bitcoin ETF that would allow investors exposure to the cryptocurrency. If the SEC approves the application, the fund would trade on the Nasdaq stock market, making it the first publicly traded spot Bitcoin ETF in the US.

However, the regulator, which has received a wave of applications filed by asset managers to establish spot Bitcoin ETF, said these filings are not clear and detailed.

SEC has reportedly passed on the apparent irregularities to exchanges Nasdaq and Cboe Global Markets, which filed the applications on behalf of asset managers such as BlackRock and Fidelity Investments.

BlackRock’s move comes after the global cryptocurrency industry being caught in the crosshairs of the US securities regulator over alleged breaches of securities laws.

Last month, Binance founder and chief executive Changpeng Zhao was accused of criminal charges as he resigned from his position as part of a $4.3 billion settlement with the US Department of Justice.