BlackRock updates SEC filing for spot bitcoin ETF, names Jane Street and JPMorgan as authorized participants

BlackRock updated its filing with the Securities and Exchange Commission on Friday for its proposed spot bitcoin ETF in what could be a final push from the asset manager toward gaining approval from the regulator, naming Jane Street Capital and JP Morgan Securities LLC as authorized participants.

Jane Street was expected, Bloomberg Intelligence ETF research analyst James Seyffart said on X in response to the filing. JPMorgan, less so, and the move was widely noted in crypto circles.  

"JP Morgan - pretty funny. One step closer to launches in the coming weeks," Seyffart said.

JPMorgan CEO Jamie Dimon has been notorious for his dismay of crypto over the years and has said before that people should stay away from bitcoin. More recently, during a Senate Banking Committee this month, he told Sen. Elizabeth Warren, D-Mass., that he would shut down crypto if he was the government. 

"Just another datapoint to update priors that we live in the clown world simulation when Jamie 'crypto should be banned' Dimon's firm would be a leading AP on the premier spot crypto ETF," Van Buren Capital's Scott Johnsson wrote on X. 

Authorized participants are registered broker-dealers used in the creation and redemption processes that have emerged as a key point of interest in ongoing talks with the SEC. 

Deadline approaches

BlackRock's latest move comes as a deadline quickly approaches in early in January for when the Securities and Exchange Commission could decide to approve or disapprove a spot bitcoin ETF, according to analysts. If approved, it could still be a few more days or weeks until the products are actually launched, according to Seyffart.  

"Obviously it’s looking more and more like this is a done deal. Would basically need the highest rungs of government to step in and stop these things from being approved," Seyffart said on X on Friday. 

One possible sticking point over the last few weeks has been whether the ETFs would have a cash or in-kind based creation and redemption models. Filings from recent meetings have appeared to nod toward a so-called cash redemption model that analysts have said the SEC seemed to be favoring. BlackRock also said as well in its latest filing that transactions "will take place in exchange for cash. Subject to the In-Kind Regulatory Approval, these transactions may also take place in exchange for bitcoin."

Bullish step

The naming of authorized participants was not yet due, but BlackRock's move was seen as a bullish step, according to Eric Balchunas, a senior ETF analyst at Bloomberg Intelligence. 

"BlackRock adding them in there is a bit of a flex in that regard," he said. "So if we see other S-1s not naming AP doesn't mean they don't have one lined up. But this does make BlackRock the first horse officially ready imo."

Also on Friday, Valkyrie filed an update with the SEC for its proposed spot bitcoin fund and named Jane Street Capital and Cantor Fitzgerald authorized participants.

Balchunas noted that Valkyrie joins "BlackRock as the two horses officially at [the] starting gate."

VanEck, meanwhile, also filed an updated for with the SEC on Friday for its proposed bitcoin fund, and posted a video on social media on Friday that teased the term "Born to Bitcoin BTC -1.34% ."

A long road

The crypto industry has been vying for years for a spot bitcoin ETF, which the SEC has not yet approved. SEC Chair Gary Gensler said earlier this month that the agency was taking a "new look" at applications following recent court rulings. 

A Washington D.C. court siding with Grayscale over the summer has been seen as a sign that an approval could be incoming. Three judges in the U.S. Court of Appeals for the D.C. Circuit ruled in August that the SEC had to re-review Grayscale's bid for a spot bitcoin ETF after the asset management firm sued the agency last year following the rejection of its plan for the conversion of its flagship GBTC fund.