Since a Wall Street giant made an unexpected announcement about the price of bitcoin, the value of cryptocurrencies, including bitcoin, has surged this week.
With excitement surrounding BlackRock’s bitcoin spot exchange-traded fund (ETF) application reaching a fever pitch and renowned investor Warren Buffett reportedly making a fortune from the cryptocurrency, the price of bitcoin has surpassed $35,000 per coin, marking its highest level in over a year.
As the market adjusts to a recent “huge shift,” a bitcoin market analyst with cryptocurrency fund Galaxy Digital has forecast that the $48.3 trillion U.S. wealth management sector may soon have access to the bitcoin and cryptocurrency market.
The most addressable and direct market with the greatest net new accessibility from an authorized bitcoin ETF is probably the wealth management sector in the United States. Research associate Charles Yuhe of Galaxy Digital wrote a note. Assets under management by banks ($11 trillion), RIAs ($9 trillion), and broker-dealers ($27 trillion) added up to a total of $48.3 trillion as of October 2023.
Yu projected that the approval of a bitcoin spot ETF by the Securities and Exchange Commission (SEC) would boost the price of bitcoin by nearly 75% in less than a year and possibly draw in over $14 billion in capital. Should this happen, the price of bitcoin would return to its peak in late 2021, when it was almost $70,000 per unit.
There’s growing expectation that ETFs will be approved soon, and our analysis indicates that these products may see large inflows, mostly from wealth management channels that can’t currently access bitcoin exposure at scale safely and efficiently, Yu wrote.
As news broke this week that BlackRock had been given a stock market ticker for its bitcoin spot ETF, the price of bitcoin shot up, rising nearly 15% in the last three days. However, the Depository Trust and Clearing Corporation quickly squashed rumours that the ticker was new or noteworthy.
Expectations that the SEC will give in to the volume of applications are high after BlackRock’s June bitcoin spot ETF application started a race on Wall Street to be the first to market with a bitcoin fund.
A former managing director at BlackRock stated earlier this month that the SEC would likely approve a long-awaited bitcoin spot ETF in a few months, allowing funds that oversee $17.7 trillion in assets to proceed.
