Sun. Jun 16th, 2024

Spot Bitcoin ETF Approval: What Is Next For Bitcoin

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The Securities and Exchange Commission’s approval of spot Bitcoin ETFs marks a high point for bitcoin and other digital assets. 

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Application for bitcoin spot ETFs has received rejections by the SEC for over 10 years. The first spot Bitcoin ETF application filed in 2013 was rejected and every subsequent ETF proposal was also rejected due to various concerns related to financial stability and market integrity.

According to a Jan. 10 regulatory filing, all the 11 ETF proposals have been approved by the SEC.

The approved ETFs include the Grayscale Bitcoin Trust, Bitwise Bitcoin ETF, Hashdex Bitcoin ETF, iShares Bitcoin Trust, Valkyrie Bitcoin Fund, ARK 21Shares Bitcoin ETF, Invesco Galaxy Bitcoin ETF, VanEck Bitcoin Trust, WisdomTree Bitcoin Fund, Fidelity Wise Origin Bitcoin Fund, and Franklin Bitcoin ETF.

The approval is a notable acknowledgment of the fast paced, ever growing landscape  of the digital asset world. And an acknowledgement of the potential of a Bitcoin-Based exchange-traded products (ETPs).

Read Also: Six Bitcoin ETFs to Start Trading Tomorrow 

What’s Next For Bitcoin?

Bitcoin spot ETFs is a game-changer for bitcoin as it offers institutional and retail investors exposure to the world’s largest cryptocurrency without directly holding it and having to go through the complex process of buying it from exchanges. The approval is also a  major boost for a crypto industry that has lately been “bedeviled” by scandals

Although the approval as reiterated by the SEC boss, does not indicate a nod of approval or an endorsement for the general public to invest in bitcoin, analysts believe that bitcoin has officially been introduced Bitcoin has been introduced to mainstream finance and more liquidity will be coming in as a result of that.

Analysts from Standard Chartered this week said the ETFs could draw $50 billion to $100 billion this year alone, driving the price of bitcoin as high as $100,000. 

However, the Standard Chartered executives noted that the value of gold exchange-traded products multiplied by this 4.3 figure around seven to eight years after gold ETPs were launched in November 2004. Regardless of this fact, they expect bitcoin to perform even better at a faster rate.

Bloomberg Intelligence’s senior macroeconomic strategist Mike McGlone was less confident Bitcoin will sustain its rally after Bitcoin ETFs are potentially approved.

“Risk assets have to go down. It’s almost always — that’s what’s missing. And Bitcoin is one of the riskiest assets,” He opined. 

He added that, “We’ve had the hopium. We’ve rallied 50% from $30 [thousand]. We’ve rallied 3x from last year […] You don’t want to be getting overweight here. You want to be saying thank you.”

So far, at the time of writing, its been over an hour since the accelerated approval. The bitcoin price is slowly picking a bullish momentum.

After the news, Bitcoin saw a flash pump to $48k, and is currently trading around $47,400 at the time of writing.

According to Bloomberg ETF analyst James Seyffart, Spot Bitcoin exchange-traded funds (ETFs) are likely to begin trading on Jan. 11 following the SEC’s approval of 11 spot Bitcoin ETFs.

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