Bitcoin ETF

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Bitcoin

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 <p class="is-style-lead">The U.S. ETF market, valued at approximately $8 trillion, largely hinges on three key firms.&nbsp;</p>
 <p>Essential to the ETF ecosystem, authorized participants (APs), a specialized type of broker-dealer, have not expanded in number despite the sector’s rapid growth. These APs play a crucial role in ensuring every North American ETF’s liquidity and efficient operation.&nbsp;</p>
 <p>Bloomberg’s <a rel="noopener noreferrer nofollow" title="Category Analysis" href="https://thebittimes.com/analysis.html">Analysis</a> of over 3,400 fund filings reveals that most U.S. ETF flows are managed by just three <a rel="noopener noreferrer nofollow" title="firms" href="https://thebittimes.com/tag/firms.html">firms</a> – Bank of America, Goldman Sachs, and JPMorgan. In fact, for many funds, over 90% of all capital movements are controlled by these three APs. Astonishingly, several hundred ETFs rely solely on a single AP for their liquidity needs, based on the latest comprehensive data quarter.</p>
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 <h2 class="wp-block-heading" id="what-does-it-mean-for-the-potential-bitcoin-etfs-in-2024">What does it mean for the potential Bitcoin ETFs in 2024?&nbsp;</h2>
 <p>Relying on a few APs could introduce heightened concentration risks in the Bitcoin ETF space. Given the volatile nature of cryptocurrencies, the efficiency and resilience of these key <a rel="noopener noreferrer nofollow" title="firms" href="https://thebittimes.com/tag/firms.html">firms</a> will be under scrutiny, especially in managing high-volume transactions and ensuring liquidity.</p>
 <p>The existing oligopoly of APs may also influence the pricing and accessibility of Bitcoin ETFs. The <a rel="noopener noreferrer nofollow" title="firms" href="https://thebittimes.com/tag/firms.html">firms</a>’ pivotal role in cash flow management could impact how these new ETFs are priced and traded, potentially affecting investor access and returns.</p>
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    <p lang="en" dir="ltr">SEC Commissioner Hester Peirce on spot bitcoin ETFs…<br><br>“I thought that we should have approved one of these things over five years ago.”<br><br>via @KathieOD_PI pic.twitter.com/VwPixFXZP4</p>— Nate Geraci (@NateGeraci) December 15, 2023
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 <p>Most importantly, the SEC’s decision-making process might consider this concentration. The regulator could consider the need for a more diversified AP landscape to ensure a robust and resilient <a rel="noopener noreferrer nofollow" title="market" href="https://thebittimes.com/tag/market.html">market</a>, especially given the novel nature and potential risks associated with Bitcoin ETFs.</p>
 <p>The SEC has been actively discussing with BlackRock and several other Bitcoin ETF applicants this month for a potential approval in January. The current <a rel="noopener noreferrer nofollow" title="market" href="https://thebittimes.com/tag/market.html">market</a> rally has been largely attributed to this hype of Bitcoin ETFs. However, with such concentrated operations in the current ETF <a rel="noopener noreferrer nofollow" title="market" href="https://thebittimes.com/tag/market.html">market</a>, the community should anticipate potential complexities and challenges for crypto-based ETFs.&nbsp;</p>
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  </svg> <span class="cn-block-related-link__prefix"> Read more: </span> SEC meets with BlackRock for iShares Bitcoin ETF
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<p>Source: <a rel="noopener noreferrer nofollow" target="_blank" href="https://thebittimes.com/3-key-firms-dominate-the-etf-market-what-does-it-mean-for-bitcoin-etfs-tbt73860.html">https://thebittimes.com/3-key-firms-dominate-the-etf-market-what-does-it-mean-for-bitcoin-etfs-tbt73860.html</a></p>

3 key firms dominate the ETF market: What does it mean for Bitcoin ETFs?

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