According to analysts, in the first year of the existence of a Bitcoin ETF, the influx of investments could amount to more than $14 billion, in the second year it could increase to $27 billion and grow to $39 billion by the third year.
The approval of a spot Bitcoin ETF could attract $14.4 billion in investment in its first year, potentially boosting the digital currency by 74%, according to a report from Galaxy Digital.
Why is a Bitcoin spot ETF so important Various ETFs, including gold, have trillions of dollars in assets under management. It is generally accepted in the cryptocurrency community that even a small percentage of this capital can have an impact on the global crypto market in the future. If spot Bitcoin ETFs are approved, the demand for cryptocurrency will increase: when buying shares of funds, it is implied the supply of Bitcoin as an underlying asset, that is, its direct purchase on the market, affecting the rate.
The report's authors estimate that in the second year of the instrument's existence, investment inflows could increase to $27 billion and grow to $39 billion by the third year.rbc.groupExperts believe that ETFs may become a better investment vehicle for investors compared to trusts and futures offered on the market for now. Current products have significant disadvantages, such as high fees, low liquidity and inaccessibility to a wide range of investors. An ETF, on the other hand, could be suitable for anyone who wants to start trading digital currency without actually owning it. “The asset management industry in the US is likely to be the most promising market to gain access to Bitcoin ETF trading. As of October 2023, the total capitalization of assets under management of US brokers, banks and other private companies is $48.3 trillion,” the report says. Instruments based on Bitcoin ETFs will allow investors to gain access to digital currency through an approved list of partner companies, including consisting mainly of investment funds and banks with a good reputation, Galaxy Digital analysts conclude.Galaxy Digital is a digital asset management company founded by Mike Novogratz in 2018 after leaving Goldman Sachs. In April of this year, the entrepreneur predicted that Bitcoin would rise to $40 thousand if the US Federal Reserve System (FRS) began to lower rates. Several large financial institutions have already submitted applications to launch Bitcoin ETFs, and the first of them may be approved in the first quarter of 2024 of the year. According to CryptoQuant analysts, if issuers invest 1% of their assets in these ETFs, the price of Bitcoin could increase to $50-70 thousand.