Why Approval of Spot Bitcoin (BTC) ETFs is Needed, According to Michael Saylor
In the world of digital currency, spot Bitcoin (BTC) ETFs are expected to have a whole lot of impact. Michael Saylor, cofounder of MicroStrategy and a staunch Bitcoin (BTC) supporter, recently highlighted the importance of approving spot ETFs. He pointed out the gap between the price return of ProShares Bitcoin (BTC) Strategy ETF (BITO) and the price of Bitcoin (BTC) itself. Although while Bitcoin (BTC) has seen a 57% increase year to date, BITO only rose by 28%. Saylor claimed that this gap demonstrates the necessity of approving spot Bitcoin (BTC) ETFs.
Comparing Bitcoin (BTC) ETF Price Return to Total Return
Nonetheless, Bloomberg ETF analyst James Seyffart made it clear that Saylor was comparing the price return of Bitcoin to the price return of BITO, not taking into account the total return which includes dividend value. And once considering total return, the ProShares ETF lags behind by around 6.4% year to date. Approving spot Bitcoin (BTC) ETFs could help institutionalize the cryptocurrency market and potentially minimize the gap between returns in futures ETFs and spot ETFs. This could likewise lead to increased demand for Bitcoin (BTC) as institutions like Blackrock and Fidelity accumulate large volumes of Bitcoin to operate the ETFs.
Hot Take: The approval of spot Bitcoin (BTC) ETFs would bring greater institutionalization to the cryptocurrency market and potentially reduce the gap between futures ETFs and spot ETFs. This move could likewise generate higher demand for Bitcoin (BTC) as more institutions enter the market. It remains to be seen how MicroStrategy will adjust its buying strategy if spot ETFs become a reality.
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