BlackRock launches spot Bitcoin private trust

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BlackRock is launching a spot bitcoin private trust to provide institutional clients in the United States with direct exposure to the world’s largest cryptocurrency. 

Ticker Security Last Change Change %
BLK BLACKROCK INC. 728.65 +3.44 +0.47%

Bitcoin was trading above $23,000 per coin in mid-morning trading Friday. The cryptocurrency with a $455 trillion market cap has rebounded since falling to a 52-week low of $17,601.58 per coin in June. However, it is still well off its all-time high of $68,990.90 per coin hit last year. 

"Despite the steep downturn in the digital asset market, we are still seeing substantial interest from some institutional clients in how to efficiently and cost-effectively access these assets using our technology and product capabilities," the world’s largest asset manager said in a blog post on Thursday.

COINBASE REPORTS LOSS AMID CRYPTO TURMOIL, SHARES FALL

BlackRock's announcement comes as the U.S. Securities and Exchange Commission has denied several applications for spot Bitcoin exchange traded funds (ETF), including Grayscale investments, Fidelity and VanEck. 

Ticker Security Last Change Change %
GBTC GRAYSCALE BITCOIN TRUST 15 -0.18 -1.19%
BITO PROSHARES TRUST BITCOIN STRATEGY ETF 14.71 -0.27 -1.80%
GCC WISDOMTREE TRUST ENHANCED COMMODITY STRATEGY 23.17 -0.16 -0.69%
BITQ EXCHANGE TRADED CONCEPTS TRUST BITWISE CRYPTO INNOVATORS E 9.52 +0.02 +0.21%

Instead, the agency has green lit ETFs that offer exposure to Bitcoin but are not pure plays, including the ProShares Bitcoin Strategy ETF, WisdomTree’s Enhanced Commodity Strategy Fund and the Bitwise Crypto Industry Innovators ETF. 

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In addition to the trust, BlackRock has been conducting work in four areas of digital assets where it sees a "potential benefit" for its clients and capital markets more broadly. The areas include permissioned blockchains, stablecoins, cryptoassets and tokenization.

BlackRock has also partnered with cryptocurrency exchange Coinbase to provide more clients with access to digital assets, including Bitcoin, through its Aladdin platform. 

"Leveraging Coinbase’s comprehensive trading, custody, prime brokerage and reporting capabilities, common clients will be able to manage their bitcoin exposures alongside their public and private investments," BlackRock said. 

Ticker Security Last Change Change %
COIN COINBASE GLOBAL INC. 86.60 +2.60 +3.10%

The firm also touted the work of energy nonprofits RMI and Energy Web, who are developing programs to bring greater transparency to sustainable energy usage in bitcoin mining.

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