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BlackRock Insiders Say Bitcoin ETF is Matter of ‘When, Not If’ — Potential December Approval

Last Updated August 9, 2023 1:56 PM
Teuta Franjkovic
Last Updated August 9, 2023 1:56 PM
Key Takeaways
  • The CEO of Galaxy Digital predicts a four- to six-month regulatory window for a spot Bitcoin ETF
  • Mike Novogratz warned investors that he would “fight like cats and dogs to win market share”
  • Invesco renewed its application only a few days after BlackRock resubmitted

Galaxy Digital CEO Mike Novogratz used insider connections at BlackRock and Invesco where it is claimed that institutional players think that regulatory approval for a spot Bitcoin exchange-traded fund was a “question of when, not if.”

BlackRock told CCN it has filed a registration statement with the SEC, and due to regulatory filing restrictions, it is not able to provide further comment.

Bitcoin ETF Likely 6 Months Away

During the company’s second-quarter earnings  call on August 8, Novogratz commented that the connections anticipate that the SEC would approve spot Bitcoin ETFs within the following four to six months.


The introduction of Bitcoin ETFs by major companies like BlackRock has started to change institutional investors’ perceptions of the leading cryptocurrency.

“Institutions have come back some in the immediate term. They’ve come back in futures. They’ve come back in some of these stocks. But importantly, they’re coming back in structural ways,” he stated .

Novogratz cited as examples Monday’s stablecoin launch by PayPal Holdings and Deutsche Bank’s request for cryptocurrency custody services. Many organizations, including college endowments, pension funds, and asset managers, “got to the starting line, and then they all backed away,” he added, prior to the FTX exchange’s collapse.

Globally, stablecoin usage is increasing, according to Novogratz. With PayPal’s involvement, “they could end up creating a stablecoin that gives interest — which right now would be a security — that really destabilizes the banks.”

Fink as a Spearhead

BlackRock CEO Larry Fink, who formerly referred to Bitcoin as a “speculative investment” but has now changed his mind, is perhaps best known for spearheading the asset management industry’s adoption of the digital currency.

Novogratz previously claimed  that Fink had supported Bitcoin as the first “global money,” giving the virtual currency additional legitimacy within the conventional financial sector.

The approval of the spot Bitcoin ETF, in Novogratz’s opinion, is the opening for institutional investment into the cryptocurrency market since it will make it “very easy for people to make large allocations into the space.”

Additionally, Novogratz underlined Galaxy Digital’s determination to vigorously compete for a part of the ETF industry, saying:

“Once it’s approved, we’re going to fight like cats and dogs to win market share.”

An ETF Might Arrive Even Sooner

Chris Ferraro, president of Galaxy Digital, said  in answer to a query that he wouldn’t be shocked if the SEC ultimately approves a prospective Bitcoin ETF to avoid being branded as “obstructionist.”

“I believe that’s where the potential ETF approval comes in saying, hey, you can’t call us anti-crypto, we just approved an ETF,” the author commented and added the company is thus hoping that its filing will receive the same treatment.

Meanwhile, depending on the outcome of Grayscale’s case against the SEC, some analysts think the wave of spot Bitcoin ETFs may arrive even sooner.

Last year, Grayscale filed a lawsuit against the SEC  when the agency denied its request to turn its Grayscale Bitcoin Trust into a spot ETF..

The path of least resistance, according to analysts , would be the simultaneous acceptance of a number of or all spot Bitcoin ETF applicants should the SEC lose its lawsuit against Grayscale.

BlackRocks’s Win Would Show the SEC’s Confidence

Jeff Feng, co-founder of SEI Labs and a former Goldman Sachs analyst, commented  that BlackRock obviously believes that its ETF application will allow it to keep a strong presence in international capital markets. He added that if it becomes successful, it would demonstrate the SEC’s confidence in its leadership to handle the difficulties of a novel product while also legitimizing Bitcoin.

“Given BlackRock’s change in its position about bitcoin over the last few years, it’s clear that they do not view bitcoin and tokenization as something that can be ignored as a globally traded asset,” he said .

The success of the first Bitcoin Futures ETF to receive regulatory approval is proof that the first to market will probably make a fortune. Just two days after its debut, the ProShares Bitcoin ETF  recorded $1.2 billion in turnover, which is the quickest an ETF has ever done so.

Because of this alleged first-mover advantage, certain businesses, like Grayscale Investments, have asked the SEC to consider all spot Bitcoin ETF applications similarly and approve them all at once, should that be their preferred course of action.

A SEC’s decision is anticipated this week to be made in accordance with the 45-day window starting from the date of the initial submission.

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