The jury is out. The availability of a spot Bitcoin exchange-traded fund by the US Securities and Exchange Commission will likely boost its value such a narrative could triple-digit percentage points in the price of Bitcoin as analyzed by in-chain data provider CryptoQuant.
CryptoQuant claims that if top financial firms that have applied to issue a spot Bitcoin ETF allocated a portion of their assets under management (AUM) to the leading digital asset, billions of dollars would flow into the BTC market and subsequently cause Bitcoin’s price to more than double.
Financial behemoths like BlackRock, VanEck, and Fidelity Investments are among those looking to launch a spot Bitcoin ETF.
- “Once these ETFs are approved, we might expect $155 billion to enter the Bitcoin market. These companies have about $15.6 trillion in assets under management overall. The total amount of US dollars that would enter the Bitcoin market if they invested 1% of their AUM in these Bitcoin ETFs could reach $155 billion. According to the increase in the bitcoin market value calculated above, the price of bitcoin could rise to between $50,000 and $73,000 because of these inflows of new capital. “.
- At the time of writing, Bitcoin is trading at $28,250; a rise to $73,000 would indicate a 155% gain. Regarding the potential SEC approval date for spot Bitcoin ETFs, CryptoQuant states, “Judging by the positive court decisions that Grayscale (GBTC Fund) and XRP have received in their respective legal battles with the SEC, the likelihood that these ETFs will be approved by the ultimate deadline (March 2024) has been growing, even though they are not expected to be approved this year.”.
By default, investors are optimistic about Bitcoin because of its potential as a store of value, limited supply of 21 million coins, increasing ubiquity, and protection against established financial institutions.
Its value may be driven by growing corporate adoption, growing interest from institutional investors, and the possibility of widespread adoption.
Scaramucci, a prominent hedge fund manager, recently listed several reasons for his positive outlook on Bitcoin, including the potential for a Bitcoin Exchange Traded Fund (ETF), a bearish Upcoming Bitcoin halving, federal easing, growing demand for durable assets as US deficit becomes larger and larger.
Bitcon’s halving, which reduces miner rewards per block by 50% every four years, is fast approaching, in just about six months’ time.
According to analysts, the ensuing emission controls have a cathartic effect on the performance of the BTC price, serving as a sort of springboard before Bitcoin reaches new all-time highs.
He emphasized the importance of ETFs which, if approved by the US Securities and Exchange Commission (SEC), would effectively mitigate regulatory risks and solve access issues for investors. traditional investment.
Additionally, with interest from major financial institutions such as BlackRock and Invesco, Scaramucci believes that Bitcoin’s limited supply will soon be marketed more actively to customers.
