- BlackRock changed its proposed Bitcoin ETF ticker to IBIT and made it cash-only creation instead of in-kind.
- The cash-only creation means the fund can only issue new shares for cash, not actual Bitcoin. This avoids unregistered brokers handling Bitcoin.
- Getting a new ticker and making it cash-only are steps towards potential SEC approval of the first Bitcoin ETF in the US, which could bring significant new capital into crypto.
In a new SEC filing, BlackRock said its iShares Bitcoin Trust would only allow cash—not in-kind—creation and changed its ticker to IBIT.
Details on the New Ticker
BlackRock has chosen a new ticker for its iShares Bitcoin Trust: IBIT. The new detail appeared in an amendment to the asset manager’s S-1 application which was filed with the SEC yesterday. On top of that, the filing now shows that the ETF will be cash-only.
That means new shares of the fund can only be created with cash, not Bitcoin. The switch was foreshadowed in minutes that the SEC released last week after it met with BlackRock and Nasdaq executives.
Impact of the Cash-Only Change
The SEC just was not going to be comfortable enough with in-kind because it allows registered brokers to use Bitcoin and that’s not allowed, according to Bloomberg Intelligence analyst Eric Balchunas. “I don’t think they want any unregistered subsidiaries to touch Bitcoin,” he said. “Cash creation solves that…it means the issuer basically touches the Bitcoin and no one else.”
Conclusion
The changes are yet another hint that things are moving in the right direction for BlackRock and that expectations from market analysts of SEC approval of the first Bitcoin ETF in the US may be correct. Getting a ticker registered with the clearing and settlement company is an important prerequisite to having to trade on an exchange. If approved, most market observers expect a large influx of capital to flow into crypto.
