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Bitcoin Price Shoots Up on BlackRock (BLK) ETF Approval Rumor

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The race to launch a Bitcoin ETF has been getting a lot of eyeballs as it would give a regulated and orderly way to obtain exposure to Bitcoin price swings without actually owning the cryptocurrency. On Monday, Oct 16, the price of Bitcoin (BTC) briefly crossed the $30,000 mark on reports that the Securities and Exchange Commission (“SEC”) approved BlackRock, Inc.’s (BLK - Free Report) application to launch a BTC ETF. The news turned out to be a rumor.

“The iShares Spot Bitcoin ETF application is still under review by the SEC,” a BlackRock spokesperson clarified. On this, the price of the benchmark crypto coin settled back down below $29000, falling sharply by about 8%. The SEC, too, gave a cryptic yet stern message on social media, stating, "Careful what you read on the internet. The best source of information about the SEC is the SEC."

However, the sharp uptick in the price of Bitcoin on these rumors has started speculations that an actual approval may not be far off. The regulations body has been struggling in recent days to keep the rising optimism about Bitcoin ETFs at bay, and the best it has been able to do is to delay passing its verdict on various applications. Traditional finance giants seem to have decided to go mainstream with crypto, and the market appears prepared for it.

Of late, the major development in this next-stage crypto move has been the Court of Appeals siding with Grayscale in its lawsuit against the SEC. Previously, the SEC had denied Grayscale’s application to convert its popular Grayscale Bitcoin Trust (GBTC) to an ETF. The SEC had until Friday to appeal the judge’s opinion that it had failed to provide a coherent explanation for its denial. But they did not take up that option in a significant act of omission. This will now pave the way for various companies from the traditional sector that are waiting for the SEC’s approval to jump into the crypto fray.

Apart from BlackRock, which is probably the biggest player in the race, the SEC is currently reviewing applications from major investment companies like Invesco Ltd. (IVZ - Free Report) and Franklin Resources, Inc. (BEN - Free Report) . Invesco and Franklin Resources currently carry a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.


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