Coinbase CLO Optimistic about Bitcoin ETF Approval
According to Coinbase Chief Legal Officer Paul Grewal, the US Securities and Exchange Commission (SEC) is likely to approve a spot Bitcoin exchange-traded fund (ETF) in the near future. In an interview with CNBC, Grewal expressed confidence in the approval of ETF applications, citing recent court rulings that challenged the SEC’s authority to deny such requests. He believes that the SEC’s decision not to appeal a ruling against denying Grayscale’s Bitcoin fund conversion into an ETF indicates a potential path for future approvals. While the final decision rests with the SEC, Grewal expects progress in this area soon.
Benefits for Coinbase
If a Bitcoin ETF is approved, Coinbase, as the largest crypto exchange in the US, stands to benefit. The company’s common stock is included in portfolios that offer investors exposure to cryptocurrencies. Grewal stated that he is excited about upcoming developments that will boost investor and consumer interest in crypto. Matrixport, a crypto financial services platform, predicts a major Bitcoin rally if a spot ETF enters the market. They estimate that $12 to $24 billion could flow into the Bitcoin ETF if 10-20% of precious metal ETF investors diversify as a hedge against monetary debasement and inflation.
Hot Take: Bitcoin ETF Approval Could Drive Significant Price Increase
With a potential influx of $24 billion from precious metal ETF investors and an additional $50 billion resulting from a 1% allocation recommendation by RIAs, Bitcoin has the potential to rally up to $56,000. This estimate assumes conservative scenarios and indicates the positive impact that a Bitcoin ETF approval could have on its price.
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