BlackRock CEO Larry Fink Eyes Ethereum ETF, Acknowledges Promising Potential

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by Alisa Davidson

Published: January 12, 2024 at 9:52 am Updated: January 12, 2024 at 9:53 am

by Victor Dey

Edited and fact-checked:
January 12, 2024 at 9:52 am

In Brief

BlackRock CEO Larry Fink announced intentions to list a spot Ethereum ETF, a day after the Bitcoin ETF went live.

BlackRock’s Larry Fink Commits to Spot Ethereum ETF

Investment company BlackRock announced its intentions to list an equivalent product to the spot Bitcoin ETF for ETH–the native token of the Ethereum blockchain, as part of its ongoing journey toward tokenization. BlackRock CEO Larry Fink praised the idea of an Ethereum exchange-traded fund (ETF) a day after the much-anticipated Bitcoin ETF went live.

“I see value in having an Ethereum ETF. These are just stepping stones towards tokenization, and I genuinely believe this is the direction we’re heading,” said Larry Fink, chief executive officer of BlackRock in an interview with CNBC on Friday.

Larry Fink believes that tokenization has the potential to address issues related to money laundering and other forms of corruption. Tokenization is the process of representing assets, whether real-world or digital, in the form of a token on the blockchain.

In his statement, Fink also mentioned that he views cryptocurrency not as a currency but as an asset class. He specifically referred to Bitcoin as “an asset class that provides protection” against concerns related to geopolitical risk. He drew a parallel, stating, “It’s no different than what gold represented over thousands of years.”

However, he pointed out that unlike gold, the amount of Bitcoin that can be created is nearing its limit.

BlackRock’s iShares Bitcoin Trust (IBIT) was among the several products that made their trading debut in the United States on Thursday, following the Securities and Exchange Commission’s (SEC) approval of the funds on Wednesday. IBIT contributed approximately $1 billion to the total $4.6 billion trading volume collectively reached by the ETFs.

Market Anticipates Swift Approval of Spot Ethereum ETF

Following the SEC landmark announcement, market participants shifted their focus to Ethereum in anticipation of the planned approval of a spot Ethereum ETF in May 2024. This transition was evident in a 3% surge in ETH price, reaching as high as $2,644.45 as of January 11th as per OKX market data.

Industry observers suggest that, following the approval of the spot Bitcoin ETF, spot Ethereum ETFs have a straightforward path to approval in 2024.

Eric Balchunas, senior ETF analyst at Bloomberg, estimates a 70% likelihood that spot Ethereum ETFs will gain approval by May, the month when the SEC is required to make final decisions on several applications. However, he notes that the launch timing is less certain.

Likewise, fellow Bloomberg ETF analyst James Seyffart confidently shared that the SEC will approve spot Ethereum ETFs, citing the implicit acceptance of ETH as a commodity by the SEC when it approved ETH futures ETFs in September.

BlackRock, VanEck, ARK 21Shares, Fidelity, Invesco Galaxy, Grayscale, and Hashdex are currently among the applicants competing for SEC approval for spot Ethereum ETFs. The SEC faces upcoming decision deadlines for these applications, with VanEck’s decision due by May 23, ARK 21Shares by May 24, Hashdex by May 30, Grayscale by June 18 and Invesco by July 5.

Additionally, Fidelity and BlackRock’s applications are awaiting decisions, with deadlines set for August 3 and August 7.

As the Ethereum ETF gains traction following the SEC’s nod to Bitcoin, BlackRock’s commitment to tokenization expands, marking a pivotal step in reshaping the cryptocurrency investment landscape.

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About The Author

Alisa is a reporter for the Metaverse Post. She focuses on investments, AI, metaverse, and everything related to Web3. Alisa has a degree in Business of Art and expertise in Art & Tech. She has developed her passion for journalism through writing for VCs, notable crypto projects, and engagement with scientific writing.

Alisa Davidson