Asset Management Giant BlackRock Seeks Permission With the U.S. SEC to Trade Bitcoin Futures

In a massive development, world’s biggest asset management giant BlackRock has submitted documents to the U.S. Securities and Exchange Commission (SEC) seeking an potential entry to Bitcoin Futures trading.

The SEC filing states that BlackRock will only invest in cash-settled Bitcoin futures on exchanges that are registered with the CFTC. As on date, BlackRock manages more than $7.8 trillion in assets under management. Besides, this is not the first attempt by BlackRock to venture in Bitcoin trading. Back in 2018, the company already formed a working group to consider whether it should move in Bitcoin futures trading.

The documents submitted by BlackRock to the SEC state: "Certain Funds may engage in futures contracts based on bitcoin. The only bitcoin futures in which the Funds may invest are cash-settled bitcoin futures traded on commodity exchanges registered with the CFTC.”

The documents also names two specific funds that will involve in BTC futures trading. These include the BlackRock Funds V and the BlackRock Global Allocation Fund.

This is a big development as participation by giants like BlackRock shall further improve the legitimacy of Bitcoin (BTC) as a formidable asset class. However, the institutional space seems to be currently divided in their opinions on Bitcoin.

Earlier this week, wealth management giant UBS warned that cryptocurrencies including Bitcoin can go to zero. On the other end, Barclays Private Bank chief market strategist Gerald Moser slammed Bitcoin calling it an “uninvestable” asset.

Speaking to Financial News. Moser said: While it is nigh on impossible to forecast an expected return for bitcoin, its volatility makes the asset almost 'uninvestable' from a portfolio perspective”.

Many would probably throw the cryptocurrency out of any portfolio in a typical mean-variance optimization. The performance of the cryptocurrency has been mostly driven by retail investors joining a seemingly unsustainable rally rather than institutional money investing on a long-term basis,” he added.

In another positive development, President Joe Biden, in his first day in office, has freezed the controversial regulation on “unhosted”  cryptocurrency wallets passed by form Treasury Secretary Steven Mnuchin.

While former Federal Reserve chairperson Janet Yellen (also the nominee for next U.S. Treasury Secretary) slammed Bitcoin calling it as a source of illicit activities like money laundering and terror financing.