Investors looking to bet on Bitcoin may soon have more options to choose from. Major financial firms including BlackRock, Fidelity and Invesco have filed applications to sell U.S. spot exchange-traded funds tied directly to Bitcoin holdings, and Grayscale Investments LLC won a court ruling on August 29 with its push to convert its Bitcoin trust into one Convert ETF. In the past, the U.S. Securities and Exchange Commission has routinely rejected these products, citing concerns about volatility and possible manipulation. But the Grayscale ruling and BlackRock filing in particular could show that the cryptocurrency industry is gaining the upper hand.
ETFs, a $7 trillion industry, are part of a broader family of products known as exchange-traded products, although people often use “ETFs” to refer to all of them since they are by far the largest and most popular Category are. Crypto-native companies and major Wall Street financial institutions alike are trying to launch some sort of ETF that actually holds Bitcoin, as opposed to products that invest in Bitcoin futures. Futures-backed Bitcoin ETFs have been available to US customers since 2021, but the SEC has not approved applications for so-called spot Bitcoin ETFs. Issuers and investors are advocating for making spot Bitcoin ETFs equally accessible to retail and institutional investors in the U.S., a development that has the potential to significantly expand participation in the cryptocurrency industry.
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