_An Edhat Reader
Bitcoin has been going through a tough time over the past two years, but many investors are convinced that things will soon become better and that digital gold will pick up speed again. In fact, since October, news coming from the crypto ecosystem has started to become more positive, and growth has begun to be consistent. As such, many have started looking into how to buy Bitcoin, convinced that the next bull run is just around the corner. With the prices expected to climb to very high levels quite soon, investors want to be prepared and ensure that their holdings are safe.
$141K
A recent report issued by crypto researchers discovered that the approval rate of a spot BTV exchange-traded fund has the potential to attract over $14 billion in inflows during the first year. That means that the price would jump to $141,000 by the end of 2025, a considerable change compared to the current levels. The fact that the next halving event is set to arrive very soon and is expected to increase the price will also help the values.
10% of the addressable assets in the United States would be invested in spot ETFs, and the average allocation is set to be somewhere around 1%. The largest asset manager in the world, BlackRock, is getting closer to total approval, meaning that the inflows are imminent. The company manages roughly $10 trillion worth of assets, so $14 billion isn’t that much when put into perspective. However, it means quite a lot for the market since it means that BTC will climb to $141,000, a value it has never seen before.
The possibility that this change is just around the corner is exciting for investors, especially after the bear market and crypto winter that kept the marketplace stagnant for a long time. A more than 600% increase would go down in Bitcoin’s history. Still, it’s important to remember that prices often change in this environment, and it’s almost impossible to pinpoint the market’s next movement. Investors must remain patient and wait to see if these optimistic predictions become a reality.
Argentine Bitcoin
In June 2021, El Salvador announced that it would henceforth adopt Bitcoin as a legal tender, giving it the same status as fiat currencies. The reactions to this decision were mixed, and while some applauded the move as a step towards financial independence and prosperity, others were quick to doubt Bitcoin’s ability to support the economy of an entire country. After all, even if it is much more stable than the altcoins, it remains volatile. Investors must be pretty savvy to figure out the best trading strategies and learn about the environment and historical trends to have a better chance at building a solid portfolio.
The presidential election in Argentina and the emergence of Javier Milei as president-elect has sparked considerable speculation about the fact that the country could soon follow in El Salvador’s footsteps. Researchers believe the change could happen sooner than many expect and that yet another nation could adopt Bitcoin as legal tender soon. In the past, analysts have alluded to the fact that other countries could adopt Bitcoin, and Mexico has also been on the list.
Indeed, there was a surge in the Bitcoin price immediately after Milei won the elections. The values reached the highest levels seen since May 2022. The president-elect has promised to dollarize the economy and disband the Central Bank of Argentina, citing hyperinflation as the reason. He has made positive statements about Bitcoin and cryptocurrencies, saying that their introduction signifies the return of money and assets to the private sector. Many investors believe that his presidency could signal the beginning of a new period of acceptance, adoption and integration of cryptocurrencies into Argentina’s economy.
SEC vs BTC
The United States Securities and Exchange Commission has long been at the center of a controversy regarding the approval of Bitcoin-based ETFs. The price, although climbing successfully to much higher levels than only a couple of months ago, still lacks the momentum it needs to climb even higher. A definitive approval from the SEC would instantly change this situation, but it seems there will still be a while until investors can see the changes.
In fact, some investors are concerned that the prices might drop before they’ve started making their ascending path. The Commission was expected to come up with a definitive ruling several months ago but refused to do so, citing the various problems that have affected the crypto environment recently. The most notable have been the scandals leading to the collapse of several exchanges in 2022, with the fallout of these events trailing into 2023 and continuing to leave its mark on the overall environment.
Futures
It was just two years ago that the first Bitcoin-linked exchange-traded fund became the first of its kind to climb to $1 billion in assets. However, the next few weeks will make the asset class prove its mettle and will definitively show whether the futures can also survive in the future or not. Currently, the ProShares ETF stands at $1.4 billion. It works by tracking crypto tokens through the means of futures. So far, it has been the only way United States investors can add Bitcoin exchange-traded funds to their list of holdings.
The next deadline is January 10th, and the SEC must approve the applications by then. Their primary purpose is to ensure that there’s a cheaper way for investors to gain exposure to the market. It would also make the crypto market much more engaging and offer more opportunities for potential traders and investors. Yet, regulators maintain their doubts about the environment, mainly because of what they consider to be the overly heightened risks that come with crypto trading.
However, many investors believe that it is possible to get an approval and that futures and spot ETFs can coexist.
To sum up, the market is still navigating a difficult period, but the beginning of 2024 is set to change things and usher in a new era for Bitcoin; after the long months of crypto winter, spring might finally be on its way.
