Fox Business has disclosed that BlackRock plans to cut 600 jobs as it expects the United States SEC to approve its iShares spot Bitcoin ETF product on Wednesday, Jan. 10.
The leading conservative media company revealed this in a recent exclusive report. According to Fox Business, in addition to the anticipation of an approval of its spot Bitcoin ETF, BlackRock will be cutting off 3% of its global team in the near future.
Data confirms that the layoffs will affect some 600 employees. Per the report, the practice has taken center stage as a periodic trend within the company, according to a source familiar with the matter. A series of layoffs occurred last year, impacting 500 employees in January and less than 1% in June.
When asked for comments, a BlackRock spokesperson declined to share insights on the upcoming workforce reductions. Analysts suggest the layoffs may stem from BlackRock’s shift from rapid asset growth to a more stable business phase.
The company is set to reveal its earnings for Q4 2023 this Friday. Predictions indicate a 2.46% YoY decline in fourth-quarter earnings, estimating a per-share value of $8.71.
With $9 trillion in AUM at the end of Q3 2023, BlackRock has witnessed a drop from its 2022 peak of over $10 trillion amid market volatility.
This decrease coincides with increased political scrutiny, especially regarding its adoption of Environmental Social Governance (ESG) investing.
BlackRock Expects Approval of Spot Bitcoin ETF on Wednesday
The planned round of layoffs comes amid the asset manager’s expectation of an ETF approval. Notably, this expectation aligns with the sentiment prevalent in the crypto space.
However, it contrasts a recent report from Matrixport, which predicted that the SEC would deny all ETF filings this month.
In addition, Perianne Boring, the founder of Digital Chamber, argued last week that the SEC Chairperson Gary Gensler would move against the approval of any spot Bitcoin ETF this month, stressing that he has enough reasons to reject the existing filings.
However, most industry experts believe an approval is imminent. Former SEC Chair Jay Clayton asserted last September that the agency is poised to approve the product. JP Morgan analysts also predict a similar outcome for the decision.
In anticipation of the SEC’s decision, BlackRock and other asset managers looking to launch the spot Bitcoin ETF have continued to make preparations for the trading of the product. Notably, they have submitted Form 8-A filings with the SEC and appointed authorized participants.
According to the recent Fox Business report, should BlackRock secure the much-anticipated approval, it would mark the first time the U.S. SEC is giving the green light to allow the trading of an investment vehicle which directly tracks the premier crypto asset.
Several industry commentators have projected that this pivotal development could spark the next bull run, triggering massive institutional demand for Bitcoin and bolstering adoption for the digital asset as a legitimate store of value.
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