The possible approval of a Bitcoin ETF in the United States before January 10, 2024 may see BTC soar to $150,000 due to increased institutional demand. BlackRock’s participation and positive gestures from the SEC are promising indicators for ETF approval, which caused a rise in Bitcoin price. The approval could mean a significant step towards cryptocurrency adoption, providing a link to Bitcoin similar to gold-backed ETFs.
The fervor surrounding the possible approval of a US-based spot Bitcoin ETF (exchange-traded fund) is reaching a crescendo. With Bloomberg Intelligence estimating a 90% chance of a Securities and Exchange Commission (SEC) clearance by January 10, 2024, the pulse of the cryptocurrency market is quickening.
Institutional Demand for a Bitcoin (BTC) ETF Grows
The endorsement of such a product could spell a new dawn for the price trajectory of Bitcoin (BTC), potentially propelling it to $150,000. Rumors that BlackRock is seeding its Bitcoin ETF have sent tremors through the cryptocurrency market. It subsequently pushed the price of Bitcoin above $35,000, a figure not seen in nearly 18 months, and a stark contrast to Ethereum’s 50% rise so far this year.
The recent rise in Bitcoin price, marked by a 27% increase in October, indicates a buoyant market. In fact, this speculation reflects a broader sentiment that the United States is on the verge of embracing Bitcoin ETFs.
The above will align with the more progressive position observed in Canada and Europe. Diogo Mónica, president of Anchorage Digital, explained it in the following terms:
“Institutional demand for a spot Bitcoin ETF is stronger than ever. For many institutions, it is a question of when, not if, the SEC will approve a Bitcoin spot ETF.”
The approval could also counteract the effects of the recent cryptocurrency crackdown. Therefore, a regulated avenue is opened for American companies to venture into the crypto industry. This move could see giants like Jane Street, Virtu Financial, and others provide liquidity for the BlackRock Bitcoin ETF, further bolstering market dynamics.
Currently, American investors’ path to Bitcoin exposure remains tied to futures, options, and other derivatives. Notably, Grayscale Bitcoin Trust (GBTC) is a model that has over $21 billion in assets under management (AUM). However, the appeal of ETFs, with exchange-traded features and liquidity, is undeniable.
GBTC’s transition to an ETF is a testament to this appeal, a move echoed by many other companies like Fidelity, Invesco and VanEck, all waiting for the green light from the SEC.
Bitcoin Price Prediction: Targeting $150,000
In this context, the SEC’s commitment, in particular its non-appeal of the outcome of the Grayscale case, hints at a favorable verdict in January. The ramifications of such approval are profound. BlackRock’s iShares Bitcoin ETF could herald a new era of institutional participation, potentially creating a supply crisis given Bitcoin’s limited production at 21 million.
The growing momentum of Bitcoin ETFs, compared to historical performance around halving events, establishes a compelling narrative. The narrative of a new cycle, where the price of Bitcoin could soar to $150,000 by mid-2025, according to Bernstein analysts.
Direct access to Bitcoin through an exchange-traded instrument, similar to access to gold spot prices through physical gold-backed ETFs, is a milestone, a leap towards simplifying Bitcoin investing, offering a direct link long awaited by cryptocurrency enthusiasts.
However, amidst optimism, prudence is paramount. As the cryptocurrency market teeters on the cusp of potential ETF approval, investors must exercise diligence, fully aware of the volatility.
By Audy Castaneda
