Several bitcoin ETF hopefuls join BlackRock in naming Jane Street, JPMorgan Securities as authorized participants
Fidelity, BlackRock, Valkyrie, Invesco and WisdomTree reveal key details in latest amendments ahead of SEC decision
Artwork by Crystal Le
Fidelity, Invesco, Valkyrie and WisdomTree joined BlackRock Friday in naming authorized participants for their proposed bitcoin ETFs.
Some other competitors in the race to launch such funds have not yet done so.
Authorized participants, or APs, are entities that create and redeem shares of an ETF. Typically, shares can then be exchanged for a similar basket of securities reflecting the holdings of the ETF, or for cash.
Fidelity named Jane Street and JPMorgan Securities as its APs — matching BlackRock’s choices made earlier in the day.
Meanwhile, Invesco intends to use JPMorgan Securities and Virtu Securities as APs for its proposed bitcoin fund.
Bloomberg Intelligence analyst Eric Balchunas previously told Blockworks that disclosing authorized participants is one of the final steps before launching a spot bitcoin ETF, if the US Securities and Exchange Commission signs off on such offerings.
Fidelity and Valkyrie also revealed fees of 39 basis points and 80 basis points, respectively, for their proposed bitcoin funds. Others have not yet specified expense ratios. Invesco, which filed with Galaxy Digital, said it “intends to waive the entire sponsor fee on the first $5 billion of Trust assets” for its first six months trading.
Bitwise and VanEck, as well as Ark Invest and 21Shares, did not name authorized participants or expense ratios in their amended S-1s this week.
“A list of the current authorized participants can be obtained from the administrator or the sponsor,” Franklin Templeton wrote in its latest filing.
Though naming such entities is not mandatory at this stage, firms looking to launch must name an authorized participant in the effective prospectus prior to launching, Bloomberg Intelligence analyst James Seyffart noted.
The amendments come amid increased optimism that the SEC, for the first time, will approve spot bitcoin funds after Grayscale Investments notched a court victory against the regulator in August. Grayscale, which seeks to convert its Bitcoin Trust (GBTC) to an ETF, had lined up Jane Street and Virtu Financial as APs for the planned fund last year, Bloomberg reported at the time — though Grayscale’s latest S-3 filing does not name them.
In a tweet Friday afternoon, Grayscale CEO Michael Sonnenshein posted that the firm has had APs lined up “since 2017.”
21Shares President Ophelia Snyder said last month there has been a “pattern break” in terms of how the SEC has approached the latest round of bitcoin fund proposals.
“That’s really positive, because, very candidly, change in behavior might actually result in a change of outcome, and that’s really exciting,” Snyder added at the time.
Ark Invest CEO Cathie Wood told Bloomberg earlier this week that while an SEC decision isn’t a sure thing, her firm believes “the probabilities have gone up.”
Don’t miss the next big story – join our free daily newsletter.