In recent times, the growing appeal of bitcoin (btc) among asset managers and traditional financial institutions (TradFi) has gained significant attention, particularly with the notable success of bitcoin ETF products offered by industry leaders such as BlackRock, Grayscale and Fidelity.
This success has prompted more Wall Street banking institutions to eagerly enter the newly approved ETF market as authorized participants (APs).
Large institutions join BlackRock
As recently revealed gradesBlackRock has expanded the list of authorized participants for its iShares bitcoin Trust ETF (IBIT).
The addition of five new participants by BlackRock, including Goldman Sachs, Citadel, Citigroup, UBS and the ABN AMRO clearinghouse, bringing the total number of authorized participants to nine. This move occurs when the fund attracts substantial investments from individuals and institutions.
It is worth noting that Jane Street Capital, JPMorgan, Macquarie and Virtu Americas were already on the list of authorized participants.
According to BlackRock's filing, authorized participants will conduct cash-only transactions to create and redeem ETF shares. They will not directly or indirectly handle bitcoin as part of the creation or redemption process.
Authorized Participants play a critical role in the ETF ecosystem. They have agreements with ETF issuers that give them the right to create and redeem ETF shares in response to market demand. These participants may act on their own behalf or on behalf of others. market participants and are not compensated by ETF issuers.
By dynamically adjusting the number of ETF shares outstanding, authorized participants aim to increase efficiency and reduce costs for ETF investors.
Wall Street Giants Embrace bitcoin ETF Market
Adding high-profile Wall Street institutions such as Goldman Sachs, Citigroup, UBS and Citadel to authorized participants underlines the growing interest and acceptance of bitcoin-related financial products.
Bloomberg ETF Expert Eric Balchunas x.com/EricBalchunas/status/1776229982559223971″ target=”_blank” rel=”noopener nofollow”>suggests that these banking giants have a new interest in the sector or now feel comfortable publicly associating with it.
According to Balchunas, his involvement was not previously explicitly mentioned in ETF filings. However, the notable growth and success of these ETFs likely influenced their decision to participate openly.
In terms of market flows, the ten Spot ETFs recently approved by the United States Securities and Exchange Commission (SEC) have x.com/WuBlockchain/status/1776259143961288816″ target=”_blank” rel=”noopener nofollow”>shown constant interest from investors. On April 4, these ETFs recorded a notable net inflow of $213 million, marking the third consecutive day of positive flows.
However, Grayscale's GBTC saw a substantial net outflow of $79.3 million in a single day. The historical network exit for GBTC it has now reached $15.31 billion.
On the other hand, BlackRock's IBIT ETF emerged as the best performer, witnessing a significant net inflow of approximately $144 million on the same day. This brings IBIT's total historical net inflow to $14.4 billion.
btc is trading at $67,700, experiencing sideways price action over the last 24 hours and a 2% price drop in the last seven days despite the success of the bitcoin ETF market.
Featured image from Shutterstock, chart from TradingView.com
