In October of 2023, BlackRock, the world’s largest asset manager, received $100,000 from an unknown investor as seed funding for their Bitcoin spot ETF. This information was revealed in the company’s recent filing with the SEC.
The investor purchased 4,000 shares at $25.00 per share, and acted as a statutory underwriter for the seed creation baskets.
BlackRock also disclosed their plans to pay their sponsor’s fees by borrowing either Bitcoin or cash from a lending institution for a short period of time.
This allows BlackRock to charge their fees without affecting the price of Bitcoin.
The settlement for these trade credits will occur the day after the trade takes place, and will incur a financing fee of 11% plus the Federal Funds Target rate divided by 365. This was described as an interesting development by ETF analyst Eric Balchunas.
