Yiannis Giokas, a senior director at Moody’s Analytics, attributes the recent surge in Bitcoin’s price primarily to the increasing number of applications for spot Bitcoin BTC -0.62% exchange-traded funds (ETFs) awaiting approval by the U.S. Securities and Exchange Commission (SEC).
He pointed out that the anticipation of these approvals has heated up the race among large asset managers to acquire Bitcoin. These asset managers are preparing to purchase Bitcoin in readiness for offering spot Bitcoin ETFs to both retail and institutional investors. Giokas’s statement underscores the broader market anticipation and the potential impact of these ETFs on the Bitcoin market.
Moody’s Analytics, a subsidiary of Moody’s Corp. that focuses on non-rating activities, has been closely monitoring these developments. Bloomberg has predicted a 90% chance that the SEC will approve spot Bitcoin ETFs by January 10, noting that the SEC has been in discussions with exchanges and spot Bitcoin ETF issuers, including Blackrock, Ark Invest, and Grayscale Investments, regarding their applications.
This enthusiasm around spot Bitcoin ETFs has contributed to Bitcoin’s significant value increase, with a 150% surge over the year, reaching over $42,000. The price of Bitcoin had risen over 6% to reach $42,144, its highest level since April of the previous year.
The impact of these potential ETFs is viewed differently across the financial sector. Skybridge Capital founder Anthony Scaramucci anticipates a massive inflow of capital from Wall Street into Bitcoin following the launch of spot Bitcoin ETFs. Former NYSE President Tom Farley also expects a substantial influx of money into the crypto industry with these approvals.
Financial advisors, according to Ric Edelman, are waiting for the SEC’s approval of spot Bitcoin ETFs to offer these investments to their clients. However, JPMorgan has warned that the launch of spot Bitcoin ETFs could exert “severe downward pressure on Bitcoin prices”.