Will SEC Greenlight Prime Agent for Bitcoin?

• BlackRock has appointed a Prime Execution Agent to buy and sell Bitcoins on behalf of the platform.
• Bloomberg analyst James Seyffart commented that the SEC might not be comfortable with the Prime Execution Agent.
• The analyst also added that Bitwise was the first ETF filer to change to a Cash-Only model.

Investment firm BlackRock has appointed a ‘Prime Execution Agent’ or a third-party broker to buy and sell Bitcoins while the community anticipates a nearing Spot Bitcoin ETF launch. In a recent X post, James Seyffart, a senior analyst at Bloomberg, shared insights on the least possibility for the SEC to approve BlackRock’s third-party interference, as they are allegedly less “comfortable” with the interference of a Prime Execution Agent.

According to the BlackRock proceedings, the cash deposits will be held by the Cash Custodian or the Prime Execution Agent on behalf of BlackRock. Though the company hasn’t mentioned the name of the Prime Execution Agent, previously, when BlackRock filed an ETF application, it announced Coinbase as its custodian.

Reports suggested that the regulators had been in discussion with the crypto exchanges, addressing the “19b-4 filings.” While these filings signify a change in rules, the SEC’s reference to the filings indicated their preference for “cash creates” as opposed to in-kind transactions in Bitcoin ETFs.

Charles Gasparino, Fox Business correspondent, hinted at a “rare joint conference call” involving the SEC and the spot Bitcoin ETF filers. Moreover, Fox Business Journalist Eleanor Terrett asserted that the calls were intended to make “sure everyone is doing cash creations.” She added, “The SEC Gov asked issuers to remove all hints of in-kind redemptions from their filings.”

In response to these critical developments, Seyffart stated, “SEC might not be comfortable with a Prime Execution Agent (a 3^rd party buying and selling bitcoin on behalf of the ETF) purchasing the Bitcoin in the cash model.”

He further added a list of ETF filers who have already set up for cash-creates as well as those preferring in-kind. According to his analysis, Bitwise was the first platform to switch to a “Cash-Only model.”