Cathie Wood’s Expectations for Potential Spot Bitcoin ETF Approvals
Cathie Wood, the CEO of Ark Investment Management, discussed the potential approval of spot bitcoin exchange-traded funds (ETFs) by the U.S. Securities and Exchange Commission (SEC) in an interview with CNBC. The deadline for the decision on her firm’s joint proposal with 21shares is approaching on Wednesday, which marks the first deadline for spot bitcoin ETF applications this year.
Institutional Interest in Bitcoin Investment
Wood believes that if spot bitcoin ETFs are approved, it will serve as a green light for institutional investors. She stated that the SEC’s approval would pave the way for institutions, as many of them have shown increased interest in bitcoin due to the regulatory developments.
Probability of Approval and “Sell on the News” Event
Regarding the likelihood of the SEC approving her firm’s spot bitcoin ETF proposal, Wood expressed confidence, stating that the probability is very high. She noted that the SEC has asked detailed and technical questions, indicating that they have gone through an extensive due diligence process.
Wood also challenged the notion that spot bitcoin ETF approvals would lead to a “sell on the news” event. She suggested that the market may have already priced in this expectation and that institutional positioning could prevent such a reaction.
Expectations for Bitcoin Price Increase
Wood outlined her beliefs on why the price of bitcoin will continue to rise. She compared bitcoin to digital gold, highlighting the potential for substitution. She also emphasized the importance of institutional flows, stating that even a small allocation by institutions into bitcoin could have a significant impact on the price due to the asset’s scarcity.
With approximately 19.5 million bitcoin already in circulation and a limited supply of 21 million units, Wood described bitcoin as a scarce asset. She expects that institutional allocations and the increasing demand for this new asset class will further drive the price of bitcoin higher.
Hot Take: Expectations of Institutional Interest and Bitcoin Price Surge
Cathie Wood, CEO of Ark Invest, anticipates that the approval of spot bitcoin ETFs by the SEC will lead to a surge in institutional interest and a significant price increase for bitcoin. She believes that the regulatory approval will serve as a green light for institutions to invest in bitcoin, as the SEC effectively paves the way for their involvement. Wood also dismisses the idea of a “sell on the news” event, suggesting that the market has already priced in this expectation. With bitcoin’s scarcity and the potential for institutional allocations, she expects the price to continue moving higher in the long term.
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