BlackRock, the world’s largest asset manager, has taken a significant step towards enhancing the accessibility and liquidity of its spot Bitcoin ETF, iShares Bitcoin Trust (IBIT). The company has updated its prospectus to include five new Authorized Participants (APs):
ABN AMRO Clearing USA LLC
Citadel Securities LLC
Citigroup Global Markets, Inc.
Goldman Sachs & Co. LLC
UBS Securities LLC
What are Authorized Participants (APs) and Why Do They Matter?
APs play a critical role in the creation and redemption of ETF shares. They act as intermediaries, transferring cash to and from the Trust Administrator, facilitating a smooth flow for investors entering or exiting the fund.
Increased Liquidity and Accessibility for IBIT
By expanding the pool of APs from four to nine, BlackRock aims to increase the overall liquidity and accessibility of IBIT for investors. This broader network of institutions will enhance the efficiency of share creation and redemption processes.
Previously Listed APs
The existing APs for IBIT, as per the previous prospectus, included:
Jane Street Capital, LLC
JP Morgan Securities LLC
Macquarie Capital (USA) Inc.
Virtu Americas LLC
Growing Mainstream Acceptance of Bitcoin
The inclusion of prominent names like Goldman Sachs and Citigroup as APs signifies a growing mainstream acceptance of Bitcoin as an investable asset class. This move also reflects the rising demand for regulated investment vehicles that provide exposure to digital assets.
Stellar Performance of Spot Bitcoin ETFs
Since their launch in January 2024, both IBIT and Fidelity’s Wise Origin Bitcoin Fund (FBTC) have displayed exceptional performance. According to Bloomberg data, these two spot Bitcoin ETFs have achieved a remarkable feat, recording net inflows for a record-breaking 49 consecutive days. This achievement is only shared by 30 other ETFs in history.
The resilience of these funds is further emphasized by their ability to attract inflows even during periods of declining Bitcoin prices. Notably, IBIT accounts for over half of BlackRock’s year-to-date net flows, surpassing inflows of any other BlackRock ETF by a significant margin. Similarly, FBTC is responsible for 70% of Fidelity’s total inflows.
Investor Demand for Regulated Bitcoin Exposure
The sustained investor demand for IBIT and FBTC underscores the growing acceptance of cryptocurrencies as a legitimate asset class. It also highlights the increasing preference for regulated investment vehicles that offer exposure to digital assets within a secure framework.
Positive Development for IBIT’s Growth
As spot Bitcoin ETFs continue to gain traction, the expansion of the AP list for IBIT is a positive development. This strategic move is likely to contribute to the continued growth and stability of the fund by enhancing its liquidity and accessibility for a wider range of investors.
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