Table of Contents
- The Authorized Participant Role
- Goldman Sachs Targets Key Partnerships
- BlackRock and Grayscale's Choice of APs
- Financial Giants Moving Into ETF
Banking behemoth Goldman Sachs has expressed an interest in getting actively involved as an authorized participant in the proposed spot Bitcoin ETFs introduced by BlackRock and Greyscale.
The Authorized Participant Role
The ongoing saga of Bitcoin exchange-traded funds (ETFs) is taking an interesting turn as reports suggest that Goldman Sachs is positioning itself to become an authorized participant (AP) for Bitcoin ETFs introduced by BlackRock and Grayscale.
These ETF applications are currently awaiting the final green light from the US Securities and Exchange Commission (SEC). If approved, they will require authorized participants to facilitate the creation and redemption of ETF shares. This critical role ensures that the trading of ETF shares aligns with the underlying assets, maintaining the integrity of the investment vehicle.
Goldman Sachs Targets Key Partnerships
Recent reports reveal Goldman Sachs' strategic focus on partnering with BlackRock, the world's largest asset manager, and Grayscale, a major player in the cryptocurrency investment space with its $26 billion Bitcoin Trust. Seeking the role of an authorized participant, Goldman Sachs aims to join the league of financial giants like JPMorgan Chase, expressing interest in serving as APs for potential ETF issuers.
This situation isn't the first time Goldman Sachs has been associated with spot Bitcoin ETFs. An amendment to Hashdex's S-1 on December 22 listed Goldman Sachs as an "authorized purchaser." The filing outlined Hashdex's continuous offering of creation baskets to such entities at their net asset value, allowing authorized purchasers like Goldman Sachs to sell shares to the public.
BlackRock and Grayscale's Choice of APs
BlackRock, the world's largest asset manager, has already named Jane Street and JPMorgan as authorized participants for its proposed ETF. The filing on December 29 marked the SEC’s reported deadline for changes to Bitcoin fund applications. According to SEC filings, BlackRock's spot ETF would involve cash creations and redemptions.
On the other hand, Grayscale is taking a distinctive approach by attempting to convert its Grayscale Bitcoin Trust (GBTC) into an ETF. Despite a recent appeals court win, the SEC has been ordered to reconsider Grayscale's application. While previously linked with Jane Street and Virtu Financial as potential authorized participants, a recent amendment to Grayscale's S-3 did not formally name any APs.
Financial Giants Moving Into ETF
Goldman Sachs potentially joining the Bitcoin ETF space would mark its entry alongside major financial institutions such as JPMorgan, BlackRock, Fidelity, and BNY Mellon. The move highlights the growing interest and participation of established financial players in the evolving landscape of cryptocurrency investments. As the ETF saga unfolds, Goldman Sachs positioning itself as an authorized participant adds another layer to the dynamic interplay of traditional finance and the crypto market.
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