JPMorgan: Approval of Spot Bitcoin ETF Unlikely to Have Significant Impact
JPMorgan strategists led by Nikolaos Panigirtzoglou have cast doubt on the anticipated impact of the potential approval of spot bitcoin exchange-traded funds (ETFs) by the SEC. They argue that the approval is unlikely to be a game changer for crypto markets due to several factors:
- Spot bitcoin ETFs have existed in Canada and Europe but have failed to gain significant investor interest.
- Outflows from gold ETFs have not benefited bitcoin funds overall.
According to JPMorgan analysts, while spot bitcoin ETFs offer some advantages over futures bitcoin ETFs, such as direct exposure to the cryptocurrency, potential for increased liquidity, and improved price transparency, these benefits are “rather marginal.” The introduction of spot bitcoin ETFs may also shift trading activity and liquidity from U.S. bitcoin futures markets. Traditional finance giants BlackRock and Fidelity are among the companies vying for approval to offer investors access to the crypto market. Optimism is growing that the SEC may provide approval this time, as ETF filers have addressed previous concerns by entering into surveillance-sharing agreements with exchanges like Coinbase.
Hot Take
The potential approval of spot bitcoin ETFs may not have the significant impact on the crypto market that many expect. While they offer some advantages over futures-based ETFs, such as direct exposure and potential for increased liquidity, these benefits are relatively small. It remains to be seen whether the introduction of spot bitcoin ETFs will result in a shift of trading activity and liquidity from futures markets. However, with growing optimism and companies like BlackRock and Fidelity vying for approval, the possibility of an approved spot bitcoin ETF is becoming more likely.
By
By
By
By