Bitcoin's value surged past $30,000 per coin on Friday, October 20, 2023, a high not seen since August. This spike was driven by optimism that the U.S. Securities and Exchange Commission (SEC) will soon authorize direct-investment Bitcoin exchange-traded funds (ETFs). The momentum was further amplified by BlackRock Inc (NYSE:BLK).'s pursuit of a spot Bitcoin ETF.
Crypto pundit DonAlt predicts that if a Bitcoin ETF is approved, the cryptocurrency's value could see an increase of over 100% from its current value of $28,448. He anticipates a post-approval price range of $60,000 to $100,000. This prediction assumes that Binance, the world's leading crypto exchange by volume, remains stable; a collapse could potentially trigger a dip to November 2022's low of $16,000.
BlackRock's initiative has spurred six other financial institutions to plan similar ETFs, which could catalyze a substantial surge in the crypto market. Blockchain analytics firm CryptoQuant projects that this could propel Bitcoin's value past $50,000 and potentially up to $73,000. This projection is based on these institutions advising their clients to allocate at least 1% of their portfolios to Bitcoin. Given these institutions collectively manage $15.6 trillion in assets, this could lead to a potential influx of $156 billion into Bitcoin.
This potential influx could trigger a multiplier effect due to higher prices and limited token supply attracting more investors and inflating prices further. Based on past bull market cycles, this could augment Bitcoin's total market cap by $465 billion to $930 billion. If Bitcoin's market cap increases by $1 trillion as projected, it would become a $1.55 trillion asset, surpassing giants like Amazon (NASDAQ:AMZN) and NVIDIA (NASDAQ:NVDA).
Investors are expecting the SEC to prefer "spot" over futures-based Bitcoin ETFs, particularly in light of a judge's ruling favoring Grayscale's Bitcoin Investment Trust GBTC and the SEC's past refusal. The SEC is expected to decide on ARK Invest and 21Shares' applications by Jan. 10, 2024. As these developments unfold, treasury yields are surging while Bitcoin and gold show resilience. Cryptocurrency market participants are eagerly awaiting SEC approvals for direct Bitcoin ETFs by early January.
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