BlackRock’s Global Allocation Fund Plans to Buy Spot Bitcoin ETFs
BlackRock has initiated the Global Allocation Fund program. As per this program, the asset management firm intends to purchase the spot Bitcoin ETFs and Bitcoin ETPs issued by other firms. The financial institution is one of the biggest asset management firms around the globe.
MALOX Program
The firm recently announced its Global Allocation Fund initiative dubbed MALOX. The details of this fund are available in a recent SEC filing recorded on 7th March. The filing revealed that the firm intends to purchase physically-backed Bitcoin ETFs as part of the MALOX program.
This filing also reveals that MALOX could buy BlackRock’s own spot Bitcoin ETF namely iShares Bitcoin Trust (IBIT). In addition, the program will also add similar offerings from other issuers.
BlackRock officials have told media that the fund will acquire shares of Bitcoin ETPs based on the price performance of Bitcoin. The firm also noted that MALOX is focused on spot Bitcoin ETFs that track the direct value of Bitcoin.
Therefore, this fund will also add shares of Bitcoin ETPs that are sponsored by BlackRock affiliates. Furthermore, the firm also confirmed that it is only going to invest in Bitcoin ETPs listed on national stock exchanges.
Traditional Stock Fund Allocation
BlackRock launched the Global Allocation Fund in 1989. This fund added shares from US and foreign equity markets. At the same time, the fund invested in debt and money market stocks such as Microsoft and Apple.
As per 7th March filing, the MALOX reported $17.8 billion in asset under management. In addition to MALOX, BlackRock filed another listing with the SEC for its Strategic Income Opportunities Fund (BSIIX) on 4th March.
BlackRock opened the IBIT spot Bitcoin ETF on 11th January. This fund was accompanied by 9 other Bitcoin ETFs listed in the region. IBIT is one of the faster growing spot Bitcoin ETFs. It has multiplied Bitcoin reserves by more than 7000 percent rising from 2621 Bitcoins on 11th January to 187,531 Bitcoins on 7th March, 2024. IBIT holdings are currently valued at $12.6 billion.
BlackRock has also filed an application for Ethereum spot ETF with Securities and Exchange Commission. On November 2023, BlackRock filed an S-1 application form for iShares Ethereum Trust with in association with Divisions of Corporations in Delaware.
Various analysts claimed that the regulators may approve Ethereum spot ETF in 2024. Meanwhile, it took a decade to list the first spot Bitcoin ETF in the country.
SEC to Delay Approval of Options Trading for Spot Bitcoin ETFs
The Securities and Exchange Commission is now working on another regulatory front in regards to Bitcoin spot ETF. The agency has to finalize the decision regarding approval of options trading on spot Bitcoin ETFs by 24th April. Thus far the regulator has postponed the verdict.
In a 6th March filing, SEC asked for an extension on the application from CBOE and Miami International stock exchange to offer options trading for Bitcoin ETFs.
In the same vein, the agency has also delayed the request from NASDAQ regarding offering options trading for BlackRock’s iShares Bitcoin Trust (IBIT). The agency retained that the time allotted was insufficient to issue a ruling on the matter.
Multiple stock exchanges have filed for a Bitcoin ETF options application on 25th January. The first deadline was on 10th March in accordance with US laws that grant 45 days to analyze and settle a request.
In case of a deferral, the agency gains 45 additional days with 90 days being the maximum limit under the law. The 3 months limit for a decision regarding options Bitcoin ETF is arriving at 24th April, as confirmed by SEC.
For context, it is important to note that options are derivatives that allow traders to make directional bets regarding market movements. For bullish projections, investors can purchase at a premium called call option while bearish position means purchasing at the discount or put option.
