Bitcoin's market capitalization will increase if spot exchange-traded funds (ETFs) are approved next year. according to a new report.
CryptoQuant, which provides blockchain data to investors, said in a report this week that it expects Bitcoin's market capitalization to reach $900 billion due to the amount of money that would flow into the market from institutions.
Bitcoin's market capitalization currently stands at $550 billion, according to data from CoinGecko.
CryptoQuant also said that the rush of money into the world of digital assets could increase the total cryptocurrency market capitalization by $1 trillion.
"In fact, the potential for fresh money coming into the Bitcoin market through these spot ETFs would dwarf the amount of money that flowed into the GBTC fund, the largest Bitcoin fund in existence, in the last bull market cycle "says the report, referring to the Bitcoin Trust in Grayscale.
Grayscale's Trust differs from an ETF in that its shares are not currently registered with the SEC as securities and were It is initially only available to accredited investors and is subject to a six-month holding period. Grayscale shares are also not redeemable.
The company has tried to convert GBTC into a spot market Bitcoin ETF, but has been denied by the SEC. Grayscale then sued the SEC in June for denying its request. In August, a judge ordered a review of the SEC's denial of Grayscale's Bitcoin ETF spot application, essentially siding with the company.
Market analysts now expect the SEC to go ahead and approve Grayscale's application and many others pending review.
TO Long list of the main players on Wall Street have asked the US Securities and Exchange Commission for a Bitcoin Spot ETF. Large investors are so interested in this product that the world's largest asset manager, BlackRock, has even requested it.
Spot crypto ETFs allow investors to gain exposure to digital assets without having to buy and hold them; Financial vehicles are publicly traded and track the performance of an underlying asset or index.
But the SEC has been slow to approve one, with the regulator's chairman, Gary Gensler, as well as his predecessors, primarily citing market manipulation as the main reason for not greenlighting such a product.
Now, however, experts have said it's only a matter of time before Wall Street gets one. Along with BlackRock, Valkyrie Investments, Ark Invest and VanEck are trying to get a Bitcoin ETF approved. Bloomberg Intelligence analysts now say there is a 90% chance the US market will have a Bitcoin ETF before January 10.
