It has been just reported the fact that a massive amount of money could be flooding Bitcoin in the first five years following the BTC ETF launch. Check out the latest reports below.
Bitcoin could see massive money flow
Bitwise, the world’s largest crypto index fund manager, predicts that a Bitcoin (BTC) spot exchange-traded fund (ETF) could attract $50 billion within years of launching.
According to Bitwise CEO, Matt Hougan, the first year of a spot BTC ETF could see about $5 billion in investments.
He also pointed out that the maximum record for ETFs without their own assets is around $5 billion. Hougan predicts that a spot BTC ETF could garner about $50 billion in the first five years.
According to our estimation, the total value of the market for Bitcoin ETFs could be around $50 billion in the first five years, which seems to be a reasonable estimate.
However, this number is not guaranteed and could fluctuate in either direction. We cannot provide any specific projections.
If we consider the mature markets, Bitcoin ETFs make up only 1% of the total market. For instance, the US ETF market is worth $7 trillion, and if we take 1% of that, it comes to around $70 billion.
Currently, there is already $20 billion in GBTC (Grayscale Bitcoin Trust), which leaves a potential market value of $50 billion.
These calculations are based on current trends and figures, but it is possible that the value could increase further. The decrease in supply, due to the halving, combined with the net new demand, makes for an exciting economic prospect.
Hougan says that a spot BTC ETF will likely increase the value of Bitcoin by increasing demand:
“I’ve seen a study by [Cathie Wood’s] ARK that puts a 15x multiplier. I don’t endorse that study. But that’s one particular approach. My view is we don’t have a good view on the impact of new demand on a completely supply-inelastic commodity. And I think it’s probably not linear. It probably has an unusually shaped relationship.”
He continued and said the following:
“But I think if investors step back and think about the next three years in Bitcoin you can keep it relatively simple, which is there’s this new source of demand in the ETF wrapper, and there’s this decreased supply from the Bitcoin halving.
And of course, no market is that simple, and anything can happen and there are huge risks, but that is an overarching framework to think about Bitcoin for the next couple of years.”
