Blackrock, the world's largest asset management company, has recently started providing Bitcoin support for its clients. Blackrock's service to institutional investors and huge fund managers holds great potential for the leading cryptocurrency.
Although Blackrock has established close contacts with the cryptocurrency industry in recent years, it claimed that the demand for digital assets is still very low. Having signed a partnership agreement with Coinbase, a successful cryptocurrency exchange, Blackrock continues to increase the adoption rate of cryptocurrencies. It is known that giant names such as Amazon, Netflix, Microsoft, Paypal and Ford are among the companies that act in accordance with Blackrock.
Many companies, such as Grayscale, have filed multiple spot Bitcoin ETF applications with the United States Securities and Exchange Commission (SEC). Rejecting these applications, claiming that Bitcoin is a speculative asset, the SEC saw that institutional investors and huge companies were eager to buy BTC after Blackrock's move.
Blackrock's support for Bitcoin did not take place on the crypto currency agenda for a long time. This support of the huge fund manager may even be the most positive development for the sector so far. With the announcement that huge companies are buying Bitcoin in the future, the SEC, which can approve the spot Bitcoin ETF, can enable BTC to start a new upward adventure.
What is a Cryptocurrency ETF?
ETF; It is the abbreviation of exchange-traded funds created to provide portfolio diversity and traded on stock exchanges. An Exchange-Traded Fund (ETF) is a type of mutual fund traded on traditional exchanges. They can include assets such as stocks, commodities or bonds. ETFs have a securities or bond index.
ETF shares are essentially just a basket of traded securities. They bring together assets such as stocks, mutual funds or bonds and present them to the investor. It has become an attractive option for individuals or institutions investing in traditional markets due to its low cost, tax efficiency, and security-like operation.
Cryptocurrency ETFs, which have become the popular topic of the last period, act as a bridge for the processing of virtual assets, which continue to be discussed about their compliance with the regulations, on traditional exchanges. Cryptocurrency-based ETFs are funds created from one or more digital currencies and monitor price changes. Working like traditional ETF structures, crypto ETFs are traded like stocks on an official exchange.
For any cryptocurrency ETF to be traded, it must comply with the relevant institution's regulations and the background company must assume full responsibility. In this way, investors buy shares that represent their rights in the exchange-traded fund.