Global asset manager BlackRock has filed an application with the Securities and Exchange Commission to offer a spot bitcoin exchange traded fund. If the SEC approves the application, the fund would trade on the Nasdaq stock market, making it one of the first publicly traded spot bitcoin ETF in the US.

The USD 9 trillion money manager already runs a private spot bitcoin trust that it launched in 2022. The ETF marks a further expansion of its partnership with embattled crypto exchange Coinbase, which would be the custodian of the fund’s bitcoin. A move that could boost crypto investments The launch of a spot bitcoin ETF by BlackRock could be an improvement for cryptocurrencies after a run of bad news including the collapse of FTX in 2022 and the SEC’s decision in June 2023 to sue both Coinbase and Binance, alleging securities violations.

But it is not clear that the SEC will approve BlackRock’s application. It has already turned down several earlier proposals from other asset managers on the grounds that the tokens trade on unregulated exchanges with surveillance and manipulation risks. The watchdog is being sued by Grayscale over its refusal to allow the conversion of what was then the world’s largest crypto investment vehicle into a listed ETF.

The lawsuit contends that the SEC’s decision was arbitrary, particularly because it has allowed the launch of ETFs based on bitcoin futures. BlackRock’s move also comes at a time when the SEC has proposed new custody rules that would place additional responsibilities on asset managers to make sure that customer assets are kept in properly segregated accounts. Officials from CF Benchmarks, a provider of digital asset benchmarks, said that an estimated 20% of Americans have owned bitcoin at some point.

BlackRock’s proposed ETF potentially offers the other 80% an option that is altogether more familiar and accessible. .