In a major development in the financial world, the US Securities and Exchange Commission (SEC) has filed criminal charges against global asset management giant BlackRock for allegedly making false statements about its investments in the entertainment industry. Meanwhile, the other day, the listing of BlackRock’s ETF in DTCC increased the price of Bitcoin. Here are the details…
SEC accusation against Blackrock
The charges center on inaccuracies in reporting on Oct. 24 the high interest rates BlackRock earned on its investments in Aviron Group, a film production company. BlackRock, which has over $9.43 trillion in assets under management, financed one to two films per year in partnership with Aviron from 2015-2019. However, the reported interest rates earned on these investments were found to be falsely inflated.
In response to these accusations, BlackRock agreed to a cease and desist order and a civil penalty of $2.5 million. It is important to note that this settlement does not constitute an admission of guilt by the company. However, this development underlines the importance of accurate and truthful disclosures in the financial sector. Andrew Dean, Co-Chief of the SEC Enforcement Division’s Asset Management Unit, emphasized that investors rely on such information to make informed decisions. BlackRock’s failure in this regard is seen as a breach of trust in the eyes of stakeholders.
Bitcoin ETF disappeared from DTCC site
Aside from the SEC ordeal, BlackRock faced an unexpected setback in its cryptocurrency efforts. The firm’s Bitcoin ETF, known as iShares Bitcoin Trust, initially appeared on the Depository Trust and Clearing Corporation (DTCC) website and caused excitement among cryptocurrency investors. The expectation that BlackRock would enter the Bitcoin ETF space had sparked a rally in the market, with an increase of nearly 20%. However, this optimism was short-lived as iShares Bitcoin Trust (IBTC) suddenly disappeared from DTCC’s website. It led to a decline of approximately 3% in Bitcoin’s price. Many saw this as a promising sign for potential ETF approval. Therefore, the disappearance of IBTC was met with confusion and disappointment in the cryptocurrency space.
Senior Bloomberg ETF analyst Eric Balchunas noted that the drama surrounding IBTC’s listing appeared to be responsible for the brief crash of the DTCC website, highlighting the unique intensity of the situation. Upon IBTC’s relisting on DTCC’s website, some careful observers noticed that the “create/redeem” status had changed from “Y” to “N.” Bloomberg ETF analyst James Seyffart explained that this indicates BlackRock is preparing for an ETF launch if and when it receives SEC approval.
BTC price is still on the rise
While the recent appearance of IBTC on DTCC’s site has generated a great deal of interest, it is important to note that this does not necessarily indicate an outcome for the regulatory or approval processes. According to a DTCC spokesperson, such listings are standard practice in preparation for the launch of a new ETF. Despite the ups and downs of developments, Bitcoin maintained its stability by increasing 0.15 percent in the last hour, according to CoinMarketCap data. Currently, around $34,000 is changing hands.
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