With the approval of landmark Bitcoin ETFs for fund management giants, the SEC ushers in a new era f

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20 Jan 2024

A new era for the cryptocurrency industry was ushered in when the US Securities and Exchange Commission (SEC) allowed the trading of a batch of spot Bitcoin ETFs (exchange-traded funds).
On January 10, the regulator said that it had approved 11 applications, one of which came from BlackRock, the biggest asset management in the world. The petitions of other major fund management companies, such as Ark Invest, Fidelity, Invesco, and VanEck, were also approved, and trading of the majority of the products is anticipated to start today.
Andrew Bond, managing director and senior fintech analyst at Rosenblatt Securities, told Reuters that it was “a huge positive for the institutionalisation of bitcoin as an asset class.”
Although it initially reacted to the approvals very subduedly, the price of Bitcoin has since increased 3.2% in a day to trade at $46,992 as of 6:49 a.m. EST.
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The Approval of Bitcoin ETFs Will Spark A Capital Inflow
It is anticipated that the introduction of spot Bitcoin ETFs would serve as a spark for the infusion of billions of dollars of cash into the cryptocurrency market. Standard Chartered researchers forecast earlier this week that up to $100 billion may enter the cryptocurrency ecosystem in just this year alone. However, some analysts projected a less optimistic but still substantial $55 billion over the next five years.
By the end of 2024, the market leader’s price might rise to $100,000 due to this capital infusion, according to Standard Chartered analysts. It is then anticipated that this increasing trend will continue into the next year, potentially pushing Bitcoin to around $200,000 by the end of 2025.
The emergence of spot Bitcoin exchange-traded funds (ETFs) has sparked conjecture among cryptocurrency enthusiasts on the potential imminent arrival of Ether and XRP ETFs. The S-1 form that BlackRock submitted to the SEC at the end of last year for its iShares Ethereum Trust is one factor fueling this conjecture.
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Approval of a Spot Bitcoin ETF Does Not Mean The SEC Endorses Bitcoin
Nevertheless, in response to the historic clearance, SEC Chair Gary Gensler, who has been actively combating the cryptocurrency industry for the last year, stated, “We did not approve or endorse bitcoin,” and he cautioned investors about the “myriad of risks associated with bitcoin and products whose value is tied to crypto.”
Additionally, he dispelled any rumours that the SEC has modified its position on the cryptocurrency industry. “The approvals should in no way signal the commission’s willingness to approve listing standards for crypto asset securities,” he said in the statement.
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