An ETF, or Exchange Traded Fund, is a tradable fund listed on an exchange that allows investors to engage with cryptocurrencies without direct acquisition. This approach is legal and enables investors to participate in a fund containing digital coins, even in regions where digital assets are banished. Notably, a Bitcoin ETF also provides companies, which cannot purchase cryptocurrencies due to various reasons, with tools to capitalise on digital assetsβ price surges. Europe and Canada have already embraced this method, and the United States seeks to get the same tool, too.
We have asked experts for their insights to understand the probable timeline for the spot Bitcoin ETF approval, its potential impact on the US market, and the overall outlook.
How spot Bitcoin ETF will affect the market
Maxim Fedorov, an investment adviser at Fontvieille Investment Company, emphasised that a spot Bitcoin ETF launch in the United States would accelerate cryptocurrency integration into the traditional financial system. The adoption of this tool could boost not only BTC growth but also positively influence altcoins.
Fedorov recalled the 2021 launch of the ProShares ETF, BITO, backed by Bitcoin futures. On November 10, 2021, this development led to BTC hitting an all-time high of $68,789.
Bitcoin futures are contractual agreements based on Bitcoin, which obligate the seller to provide the buyer with underlying asset (in our case, Bitcoin) at a predetermined price within a specified period. In this context, a Bitcoin futures ETF is an exchange-traded fund investing in Bitcoin futures contracts.
The vertical line shows October 19, 2021 β the day when BITO was launched. 22 days later, Bitcoin reached an all-time high.
π¬ "Bitcoin has shown a significant growth amid the news about spot ETF-BTC launch over the past month. During the rally, the coin skyrocketed by over 25% in June. But in July, the initial impulse had already faded away. The long-lasting approval process tied to the SEC's decision dampened market enthusiasm," the expert said.
Vitalia Makeeva, Director of Client Relations at XIVE, underlined that the spot Bitcoin ETF launch in the US would sharply revive the crypto market.
π¬ "The Bitcoin ETF approval is important for the market as it not only fuels demand among investment funds but also ignites the interest of private investors. This marks another big step towards mass adoption of cryptocurrencies," Vitalia Makeeva commented.
Noteworthy figures of the industry also shared their opinions:
π Tom Lee, co-founder of Fundstrat, forecasted that the spot Bitcoin ETF approval in the US can lead to BTC skyrocketing to $150,000β180,000 by the end of 2024.
π° Michael Saylor, the founder of MicroStrategy and a prominent Bitcoin investor among public companies, speculated that a spot Bitcoin ETF will absorb trillions of dollars.
π± Bernstein analysts conjectured that the approval of this instrument will herald a fresh bull cycle across the entire crypto market.
When to expect US spot Bitcoin ETF approval
Vitalia Makeeva noted that the watchdog has a maximum of 240 days to respond, hinting at the potential for a decision on a spot Bitcoin ETF in the US within the next few months.
Gleb Jout, head of Bitget crypto exchange's Commonwealth of Independent States arm, could not pinpoint an exact timing. Nevertheless, he reassuringly said that the tool would definitely get approval either this year or the next. In his opinion, the crux of the matter is to make the regulators believe in the safety of the Bitcoin ETF.
π¬ "If BlackRock [which relaunched the race for the first-spot Bitcoin ETF approval in the US this summer] can prove that the ETF launch will not be marred by manipulation or illicit activities, the Securities Commission may have no reason to refuse," the expert said.
Jout further added that this approval aligns with the rapid global crypto market growth.
Maxim Fedorov echoed the sentiment that the green light for a spot Bitcoin ETF in the US is drawing nearer. However, he also finds it difficult to predict the exact launch date.
More opinions:
π Galaxy Digital CEO Mike Novogratz forecasted that the US market would see spot Bitcoin ETF approval prior to February 2024. As he states, this insight came from trusted sources tied to BlackRock and Invesco. Both these companies have applied for spot Bitcoin ETF launches in the US.
βοΈ Bloomberg analysts estimated the chances of spot Bitcoin ETF approval in the US at 65%. According to them, the tool may be launched as early as the fourth quarter of 2023.
π€¨ Ex-Securities and Exchange Commission (SEC) official John Reed Stark expressed scepticism regarding the possibility of the Bitcoin ETF approval in the US. Stark opined that a change in SEC leadership, which necessitates its head's resignation, would be the vital condition. Currently, Gary Gensler is in charge. Stark surmised that Hester Pierce, a loyal cryptocurrency commissioner, also known as "crypto mom", could potentially replace Gensler.
Will we see a spot Bitcoin ETF in the US?
All the experts we talked to believe that the Bitcoin spot ETF will ultimately gain approval in the US β it is just a matter of time. In fact, some of them even hold the view that the launch of this tool could occur within the coming months.
Analysts are optimistic about the potential outcomes of a spot Bitcoin ETF launch in the US, foreseeing a favourable impact both on BTC and the entire digital asset market.
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This article is not an investment recommendation. The financial transactions mentioned in the article are not a guide to action. Itez is not responsible for possible risks. The user should independently conduct an analysis on the basis of which it will be possible to draw conclusions and make decisions about making any operations with cryptocurrency.
