Goldman, Citi, and Citadel Securities among new partners in BlackRock ETF’s ‘mega absurd success’

BlackRock has added new financial heavyweights as partners in its Bitcoin spot ETF.
The approved participants are a sign that establishment firms are getting comfortable with the asset class.

BlackRock has added four top financial firms to its list of so-called authorised participants in its spot Bitcoin exchange-traded fund.

A new filing at the Securities and Exchange Commission lists Citigroup Global Markets, Goldman Sachs, and UBS Securities, as well as market maker Citadel Securities.

They join JPMorgan Securities, Australian bank Macquarie, and Dutch bank ABN Amro, as well as speed traders Jane Street Capital and Virtu Americas as authorised participants of BlackRock’s Bitcoin ETF.

Authorised participants play an important role in ETF liquidity, as they have the sole rights to create or reduce the number of ETF shares on the market.

The SEC approved BlackRock’s fund in January, along with 10 other spot Bitcoin ETFs from issuers including Fidelity and Ark Invest.

By early March, BlackRock’s ETF, named IBIT, commanded $10 billion in total assets under management — making it one of the most successful ETFs to ever launch, and a “mega absurd success” according to Bloomberg Intelligence analyst Eric Balchunas.

The problem with the mega absurd success of these young ETFs is the standard they have set for how ETFs work.. Even $VOO sees regular outflows days and literally no one cries over it
— Eric Balchunas (@EricBalchunas) April 3, 2024

As of Friday, IBIT held just over $17 billion, according to DeFi Llama data.

The addition of more authorised participants is a sign that “big time firms now want a piece of action and/or are now OK being publicly associated” with crypto-backed ETFs, Balchunas posted on X.

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He said banks like Citi are “as Boomer as you can get” and their association with the IBIT “is another step in the mainstream-ification and legitimisation” of Bitcoin.

Some global banks and investment firms are still distancing themselves from Bitcoin, however.

The chief investment officer of Goldman’s wealth management arm, Sharmin Mossavar-Rahmani, said this week that Bitcoin is not an investable asset class.

Vanguard CEO and chair Tim Buckley has said that his firm will not be offering a spot Bitcoin ETF any time soon, calling it a speculative investment.

Reach out to the authors at joanna@dlnews.com and tcarreras@dlnews.com.