According to a top BlackRock executive, financial advisors are becoming increasingly interested in spot Bitcoin exchange-traded funds (ETFs) as the cryptocurrency moves closer to becoming widely used. The BlackRock executives recently noted that they have seen an increasing trend among financial advisors to embrace spot Bitcoin ETFs with caution.
A growing number of financial advisors are looking into ways to include digital assets in their customers’ portfolios as Bitcoin establishes itself as a reliable value and investment opportunity. Samara Cohen, the Chief Investment Officer of ETF and Index Investments at BlackRock, while speaking to CNBC’s Tanaya Macheel appreciated the preventive measures financial advisors took, which explains its position as a strong manager for their clients.
In Cohen’s words, she described the clients as the assessment class that has experienced a 90% price drop. She also added that the company’s job is to develop a working portfolio, intensive risk analysis, and other necessary due diligence, which she claims the company has already started with the process.
BlackRock, Others Discuss Spot Bitcoin Future, Hints On Ethereum ETF
When assessing whether Bitcoin ETFs are appropriate for their customers, financial advisors consider three key factors: market stability, investor protection, and regulatory clarity. Major companies like BlackRock have entered the debate on Bitcoin ETFs, indicating that traditional finance circles are beginning to accept digital assets more widely.
Some major issuers who got approval to issue the Bitcoin ETF have also returned to demand for an Ethereum ETF. This development has collectively triggered the interest of an average investor. The United States Security and Exchange Commission (SEC) has expressed concerns about the rising enthusiasm among investors; hence, it is asking for caution.
However, the SEC boss, Gary Gensler, has repeatedly asked that most cryptocurrencies be treated as investment contracts, as stipulated by the federal securities laws. The recent activity in the industry is spun out of SEC’s former approach that focuses mainly on the futures and commodities section of cryptocurrencies.
Senior Staff At BlackRock Speaks, IBIT Explains It’s Position
iShares Bitcoin Trust (IBIT), while talking about the recently launched investment funds, said it has always been interested in brokerages and hedge funds. This claim is made evident in its recent 13-F filings.
Meanwhile, the Registered Investment Advisors (RIAs) have fastened the adoption process of the new product. A survey by CNBC’s Advisor Council to uncover the reason for the strategic approach by BlackRock, there have been some valid concerns, including the notorious volatility in the price of Bitcoin.
It says that it has a short-lived record, some issues complying with regulations, and an associated connection with cryptocurrency scams. This recent classification has added more complexity to the approval process of the Ethereum ETFs, which work on an entirely different network protocol, unlike Bitcoin.
SEC has approved a couple of ETFs, which are currently waiting for its S-1 filings: a final registration requirement currently under review at the staff stage. The new ETF will be listed immediately after the filings are approved, giving the market accessible Ethereum holdings similar to the spot Bitcoin ETFs.
Cohen Warns Of Need For Right Data, Coinbase CFO Speaks
Cohen, while speaking at the Coinbase State of Cryptocurrency Summit in New York, also warned that this moment is when the company needs relevant data and a comprehensive risk analysis to determine the proper role and allocation of Bitcoin required for a client’s investment portfolio.
She claims this should be done considering the amount of liquidity and risk tolerance required. Cohen says she’s looking forward to a broad adaptation, considering the involvement of advisors diligently carrying out their tasks. Coinbase Chief Financial Officer (CFO) Alesia Haas, in an interview with CNBC, said that the business community is slowly adopting the recent sentiment of Bitcoin.
This claim resonated throughout the conference session. T. Rowe Price, Head of Digital Assets Strategy, Blue Macellari, also participated, speaking on the investor’s psychological temperament and their “testing the waters” mentality. Blue also revealed that these investors are slowly becoming comfortable investing in Bitcoin.
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