According to CoinDesk, the crypto fund management business could be worth as much as $50 billion in terms of revenue, as the expected launch of spot-based bitcoin exchange-traded funds (ETFs) in the U.S. is likely to bring more capital to the market, broker Bernstein said in a research report. This is equivalent to about 4% of the present size of the crypto market, which currently has a total market capitalization of $1.08 trillion.

The crypto industry is expected to transition from a 'cottage industry' with $50 billion of managed assets to a 'formal, regulated asset management industry with $500-650 billion of assets over the next five years,' according to analysts led by Gautam Chhugani. This research comes months after companies like BlackRock filed for a spot-based ETF with the U.S. Securities and Exchange Commission (SEC). The regulator has delayed making a decision on all of the spot ETF applications until October, but the crypto market is hopeful that an eventual launch of spot-based ETFs will unlock the floodgates to mainstream money.

Bernstein expects demand to be driven by 'investment advisors, wealth and private banking integrated products and easier access to ETFs in direct broker accounts.' This would imply a 10% ETF share for bitcoin (BTC) and ether (ETH) market cap and a 5-6% share for crypto hedge funds. The report also states that 'crypto financial adoption follows hype cycles, and we expect a hockey stick adoption, with 2024 as the landmark regulatory year for approval of ETFs.'