BlackRock expects the Securities and Exchange Commission (SEC) to approve its Bitcoin spot ETF next Wednesday (10) and has raised $2 billion in funding for this purpose. Analysts say that this $2 billion will break all records for the first-day and first-week trading volume/asset management scale of all ETFs.
(Previous summary:
Bitcoin spot ETF is ready! Grayscale, Fidelity, Ark, Valkyrie… submit “securities registration form” to SEC)
(Background supplement:
Why is it an epic event for financial giant “BlackRock” to enter the Bitcoin market?)
According to a report from Fox Business, asset management giant BlackRock expects the U.S. Securities and Exchange Commission (SEC) to approve its Bitcoin spot ETF next Wednesday (10). There are also reports that BlackRock has raised $2 billion in funding to quickly open the trading market on the issuance date.
Analyst: Will break ETF trading volume record
Currently, not only BlackRock, but 10 other spot ETF issuers, including Fidelity, Ark, Valkyrie, Grayscale, Bitwise, Hashdex, Invesco, WisdomTree, Franklin Templeton, and VanEck, have submitted revised 19b-4 documents. An informed source pointed out that the SEC has requested issuers to submit revised S-1 documents by 8 am on Monday U.S. time. If both documents are approved, the spot ETF can start trading as early as the next working day.
Further reading:
Bloomberg analyst: Bitcoin spot ETF “review is complete”, SEC aims to open on 1/11
Matthew, Head of Digital Research at VanEck, said in an interview with THE BLOCK that there are rumors that BlackRock has already arranged over $2 billion in capital inflows for the new ETF in the first week, and these funds come from existing Bitcoin holders.
It is worth mentioning that Matthew stated that if there is really $2 billion in trading in the first week, it will far exceed VanEck’s expectations. Based on the trading volume of the first gold ETF, they expect the trading volume in the first quarter to be $2.5 billion. Based on similar analysis, they conservatively estimate that the Bitcoin spot ETF will have a market of $40 billion in the next two years.
Eric Balchunas, Bloomberg ETF analyst, also expressed excitement:
BlackRock rumored to lay off 3% of employees due to ESG issues
On the other hand, according to a report from Fox Business, while BlackRock is actively preparing for the release of spot ETFs, it may plan to announce layoffs of approximately 3% of its global workforce in the coming days. This time, about 600 employees will be laid off. According to a reliable source, the internal classification is attributed to routine downsizing. The source added that BlackRock also conducted layoffs based on employee performance indicators last year.
However, in reality, BlackRock is facing challenges in its Environmental, Social, and Governance (ESG) investment field. In the U.S. market, although ESG investments have been highly valued and optimistic in recent years, they have become controversial. Although in 2023, BlackRock successfully attracted as much as $187 billion in new capital inflows through its ETF business, its performance in sustainable energy investments fell short of expectations, and the return on green investment funds continued to decline.
Internal sources revealed that the funds saved from the upcoming layoffs will be reinvested in new technology fields. Although ESG has encountered opposition in the United States, this concept is still thriving internationally, especially among BlackRock’s foreign clients, including national sovereign wealth funds.