In a significant advance for the largest country in the world cryptocurrency and the widest crypto industry, the US securities regulator has given the green light to the first US-listed exchange-traded funds (ETFs) that track bitcoinaccording to Gary Gensler, chairman of the United States Securities and Exchange Commission (SEC).
The SEC has approved 11 applications, including those from BlackRock, Ark Investments/21Shares, Fidelity, Invesco and VanEck, among others. The products are expected to begin shipping on Thursday, setting off fierce competition for market share.
These ETFs, which have been in the making for a decade, are game-changers for bitcoin. They offer institutional and retail investors exposure to cryptocurrency without having to own it directly.
Analysts at Standard Chartered predict that these ETFs could attract between $50 billion and $100 billion this year alone, which could push the price of bitcoin up to $100,000. However, other analysts believe inflows will approach $55 billion over the next five years.
"It's very positive for the institutionalization of bitcoin as an asset class," said Andrew Bond, managing director and senior fintech analyst at Rosenblatt Securities. "He ETFs โThe approval will further legitimize Bitcoin.โ
The price of bitcoin rose 3% to $47,300 following the news. The cryptocurrency has already surged more than 70% in recent months in anticipation of the approval, reaching its highest level since March 2022 earlier this week. Analysts suggest that success in acquiring assets for spot bitcoin ETFs will depend on fees and liquidity.
Some issuers have even reduced their fees in new filings this week to attract investors. These fees range from 0.2% to 1.5%, and some companies waive fees entirely for a set period of time.
For short-term speculators, liquidity is more important than fees. The more liquid an ETF is, the easier it will be for investors to buy and redeem shares at prices that closely track the actual price of bitcoin.
Companies are also expected to market these ETFs heavily, with a flurry of online advertising and other forms of promotion. Some issuers, such as Bitwise and VanEck, have already run ads promoting bitcoin.
"It's unprecedented, so we'll see how it goes. I've never been in a situation where 10 of the same ETFs launched on the same day, so this is new," said Steven McClurg, chief investment officer of Valkyrie, whose ETF was among those approved Wednesday.
(With contributions from the agency)
The SEC has approved 11 applications, including those from BlackRock, Ark Investments/21Shares, Fidelity, Invesco and VanEck, among others. The products are expected to begin shipping on Thursday, setting off fierce competition for market share.
These ETFs, which have been in the making for a decade, are game-changers for bitcoin. They offer institutional and retail investors exposure to cryptocurrency without having to own it directly.
Analysts at Standard Chartered predict that these ETFs could attract between $50 billion and $100 billion this year alone, which could push the price of bitcoin up to $100,000. However, other analysts believe inflows will approach $55 billion over the next five years.
"It's very positive for the institutionalization of bitcoin as an asset class," said Andrew Bond, managing director and senior fintech analyst at Rosenblatt Securities. "He ETFs โThe approval will further legitimize Bitcoin.โ
The price of bitcoin rose 3% to $47,300 following the news. The cryptocurrency has already surged more than 70% in recent months in anticipation of the approval, reaching its highest level since March 2022 earlier this week. Analysts suggest that success in acquiring assets for spot bitcoin ETFs will depend on fees and liquidity.
Some issuers have even reduced their fees in new filings this week to attract investors. These fees range from 0.2% to 1.5%, and some companies waive fees entirely for a set period of time.
For short-term speculators, liquidity is more important than fees. The more liquid an ETF is, the easier it will be for investors to buy and redeem shares at prices that closely track the actual price of bitcoin.
Companies are also expected to market these ETFs heavily, with a flurry of online advertising and other forms of promotion. Some issuers, such as Bitwise and VanEck, have already run ads promoting bitcoin.
"It's unprecedented, so we'll see how it goes. I've never been in a situation where 10 of the same ETFs launched on the same day, so this is new," said Steven McClurg, chief investment officer of Valkyrie, whose ETF was among those approved Wednesday.
(With contributions from the agency)
