Big trading firms are in talks to provide liquidity for BlackRock's proposed spot bitcoin exchange-traded fund if it obtains regulatory approval, according to reporting from CoinDesk.
Jane Street, Virtu Financial, Jump Trading and Hudson River Trading have reportedly been in talks with BlackRock about a market-making role to provide that liquidity, according to a BlackRock slide deck reviewed by someone familiar with the matter, according to CoinDesk.
Market makers are necessary for ETFs in providing liquidity, matching buyers and sellers, and aiding in creating and redeeming those ETF shares.
BlackRock and Jane Street declined to comment. Virtu Financial, Jump Trading and Hudson River Trading did not immediately respond to a request for comment.
Virtu and Jane Street wrote in support of a separate proposal for a spot bitcoin ETF this past summer. "The bitcoin ecosystem is sufficiently robust to support a US-listed ETP," Jane Street wrote in a comment letter on Grayscale's proposal for its product.
Virtu also said investors in the U.S. would benefit from SEC approval of Grayscale's proposal for a spot bitcoin ETF, in its letter supporting converting GBTC.
All eyes on a spot bitcoin ETF approval
Bitcoin's value swiftly rose over the last few weeks following speculation around BlackRock's highly anticipated spot bitcoin ETF, which is still under review by the SEC.
BlackRock CEO Larry Fink said earlier this month that a rally in the price of bitcoin triggered by a false news report that said its spot ETF was approved served as an example of "pent up interest in crypto." The SEC has not yet approved a spot bitcoin ETF.
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