A bitcoin (BTC, -4.83%) exchange traded fund (ETF) could be on the cards in 2021.
That’s according to Eric Balchunas, Bloomberg’s “top” Intelligence ETF Analyst as reported by the organization on Tuesday.
“The institutional adoption of crypto is much greater,” said Balchunas when asked why he thought 2021 was different to the last bull run in 2017 and 2018. “You have the intense growth of ‘default’ crypto products like [Grayscale’s Bitcoin Trust] which are not ideal for retail investors and the SEC knows this.”
ETFs are a type of fund traded on exchanges that operate in a similar fashion to mutual funds and can be bought and sold throughout the daily trading period. Grayscale is owned by CoinDesk’s parent firm Digital Currency Group.
Balchunas also pointed to Canada’s financial ecosystem, which green lit its first bitcoin ETF in February, which he noted at the time was a “good sign” the U.S. would follow suit.
So far, Canada has approved four bitcoin ETFs. By comparison, the U.S. has yet to approve an ETF for any cryptocurrency despite multiple applications spanning a number of years.
“Canada has a history of being like six months to a year ahead of the U.S.,” said the analyst.
Further, the Canadian ETFs have seen notable success, with Balchunas labeling the demand from investors as “insane.” Indeed, within the first two days of trading of Purpose Investment’s ETF, Canada’s first, the fund collected over $420 million in assets under management. All four ETFs have garnered $2.3 billion in assets in just three months, he added.
Balchunas also pointed toward Gary Gensler being appointed to chair the U.S. Securities and Exchange Commission, providing with it a wealth of experience in fintech and a presumably favorable stance toward crypto since he has taught classes on the topic at MIT.
Though the analyst conceded, amid the backdrop of the Robinhood/Gamestop debacle earlier this year, Gensler may have “bigger fish to fry.” That could ultimately lead to a delay in the approval of a U.S.-sanctioned bitcoin ETF, said Balchunas.
But, he said, “the longer they delay the more they will effectively play kingmaker as whoever is out first is instantly wealthy. So I think there’s a risk of waiting too long and I think they understand that.”
According to Balchunas, there’s been a “shift” this year, meaning his team is “more optimistic of an approval than we’ve ever been.”
All writers’ opinions are their own and do not constitute financial advice in any way whatsoever. Nothing published by CoinDesk constitutes an investment recommendation, nor should any data or Content published by CoinDesk be relied upon for any investment activities. CoinDesk strongly recommends that you perform your own independent research and/or speak with a qualified investment professional before making any financial decisions.
Recommended Content
Editors’ Picks
Is Altcoin Season here as Bitcoin reaches a new all-time high?
Bitcoin reaches a new all-time high of $98,384 on Thursday, with altcoins following the suit. Reports highlight that the recent surge in altcoins was fueled by the victory of crypto-friendly candidate Donal Trump in the US presidential election.
Shanghai court confirms legal recognition of crypto ownership
A Shanghai court has confirmed that owning digital assets, including Bitcoin, is legal under Chinese law. Judge Sun Jie of the Shanghai Songjiang People’s Court shared this opinion through the WeChat account of the Shanghai High People’s Court.
BTC hits an all-time high above $97,850, inches away from the $100K mark
Bitcoin hit a new all-time high of $97,852 on Thursday, and the technical outlook suggests a possible continuation of the rally to $100,000. BTC futures have surged past the $100,000 price mark on Deribit, and Lookonchain data shows whales are accumulating.
Shiba Inu holders withdraw 1.67 trillion SHIB tokens from exchange
Shiba Inu trades slightly higher, around $0.000024, on Thursday after declining more than 5% the previous week. SHIB’s on-chain metrics project a bullish outlook as holders accumulate recent dips, and dormant wallets are on the move, all pointing to a recovery in the cards.
Bitcoin: New high of $100K or correction to $78K?
Bitcoin surged to a new all-time high of $93,265 in the first half of the week, followed by a slight decline in the latter half. Reports highlight that Bitcoin’s current level is still not overvalued and could target levels above $100,000 in the coming weeks.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.