Bitcoin ETF Anticipation Fuels Surge, Could Push Value Over $100,000

On October 20, 2023, Bitcoin’s value climbed past $30,000 per coin, reaching heights not observed since August. This surge was fueled by optimism surrounding the potential imminent approval of direct-investment Bitcoin exchange-traded funds (ETFs) by the U.S. Securities and Exchange Commission (SEC). Additionally, BlackRock Inc.’s efforts to pursue a spot Bitcoin ETF contributed to the heightened momentum.

Crypto analyst DonAlt predicts that if a Bitcoin ETF receives approval, the cryptocurrency could see its value increase by more than 100% from its current price of $28,448, estimating a post-approval price range between $60,000 and $100,000. This forecast is contingent on the stability of Binance, the largest crypto exchange by trading volume, as its failure could lead to a significant drop, potentially revisiting November 2022’s low of $16,000.

BlackRock’s initiative has prompted six additional financial institutions to consider launching similar ETFs, which could incite a major boost in the cryptocurrency market. CryptoQuant, a blockchain analytics firm, projects that this could elevate Bitcoin’s value beyond $50,000, potentially reaching up to $73,000. This estimate is based on the advice given to clients by these institutions to allocate at least 1% of their portfolios to Bitcoin. With these institutions managing a combined $15.6 trillion in assets, this strategy could result in a significant influx of approximately $156 billion into Bitcoin.

This potential financial influx may trigger a multiplier effect, where rising prices and limited token supply attract more investors, further inflating prices. Historically, during bull market cycles, this could enhance Bitcoin’s total market cap by $465 billion to $930 billion. Should Bitcoin’s market cap grow by $1 trillion as predicted, it would elevate to a total asset value of $1.55 trillion, surpassing major corporations like Amazon and NVIDIA.

Investors are hopeful that the SEC will favor “spot” Bitcoin ETFs over futures-based options, especially following a judge’s ruling that supported Grayscale’s Bitcoin Investment Trust and the SEC’s previous rejections. The SEC is expected to announce decisions on applications from ARK Invest and 21Shares by January 10, 2024. As these developments progress, treasury yields are rising while Bitcoin and gold maintain their resilience. The cryptocurrency market eagerly anticipates SEC approvals for direct Bitcoin ETFs in early January.