A Bitcoin spot ETF is on the verge of hitting the trading floor in the US. Could a decade of waiting now be coming to an end? The hopes around its launch are high.
After years of hesitating and repeated rejections, the US Securities and Exchange Commission (SEC) finally seems ready to give the green light to a Bitcoin spot ETF. The launch of this investment vehicle would mark a turning point that could propel the world’s oldest cryptocurrency out of the land of speculation into the spotlight of the mainstream financial market.
Among the items in its in-tray, the SEC must decide by January 10 on the joint application by Ark Invest, led by US star investor Cathie Wood and Swiss crypto pioneer 21Shares, as finews.com has reported.
Cleared for Landing?
The SEC might decide before the weekend, according to market experts. Given the long list of high-profile applicants, the regulatory authority may also greenlight several investment vehicles at the same time.
The SEC has vehemently opposed the integration of Bitcoin into regulated financial markets, citing the risk of market manipulation as its main concern.
Prominent Figures from Wall Street
Yet after years of hesitation, several Bitcoin ETFs have attracted not only crypto heavyweights like Hashdex and Grayscale, but also numerous Wall Street titans. US investment giants like Blackrock, Fidelity and Invesco are already poised to launch their products.
Many indications are suggesting the SEC will give the go-ahead, with trading in these investment vehicles starting on US exchanges next week. The regulatory authority has been actively engaging with the potential issuers of these ETFs in recent weeks to resolve any remaining issues.
From Huge to Skeptical
The excitement of an exchange-traded index fund has sparked a major Bitcoin rally in recent weeks. The cryptocurrency’s price has almost exclusively been on the up since October. An ETF would finally offer traditional retail investors an easy way to invest in Bitcoin without the need for crypto exchanges or wallets.
As to the potential impact of a Bitcoin spot ETF on the cryptocurrency market, opinions could hardly be more divided. They range from the optimists, who are predicting a huge influx of money from Wall Street, right through to the skeptics, who believe its launch will ultimately have no notable impact.
Fresh Investment Money
But if the ETFs are not approved, for whatever reason, the market will find it difficult to digest this news. The price will then likely fall. But all the signs are pointing to a thumbs-up, which would then attract a wave of fresh capital into the market.
Even taking into account the recent strong price gains, an influx of fresh investment money could further fuel or at least support the Bitcoin price, as ETF issuers will have to buy the cryptocurrency to satisfy demand from investors.
Institutional Interest
Because of such products, the interest of institutional investors is only likely to continue to increase, as Nicolas Marxer, Head of Blockchain Banking at Liechtenstein Bank Frick, recently said in an interview finews.com. The upcoming Bitcoin halving in spring is also fueling speculation about price gains, as has consistently been the case in the past.
