After ten years of twists and turns, the US Securities and Exchange Commission (SEC) finally made a compromise on the market. On Wednesday local time, the SEC approved a Bitcoin spot ETF for the first time in history, and authorized 11 ETFs to start listing and trading on Thursday.
The US SEC said it has approved the spot Bitcoin ETF listing transaction through an expedited model. Approved spot Bitcoin ETF issuers include:
Grayscale, Bitwise, Hashdex, iShares, Valkyrie, Ark 21Shares, Invesco Galaxy, Vaneck, WisdomTRE, Fidelity, and Franklin.
These products have been in the works for 10 years. They have changed the rules of the Bitcoin game, giving institutional and retail investors access to the world's largest cryptocurrency without directly holding Bitcoin, which is a major boost for the crypto industry, which has been plagued by a series of scandals.
Although SEC Chairman Gary Gensler said the approval did not amount to regulatory approval of Bitcoin, he called Bitcoin “a speculative, volatile asset.”
However, Bitcoin followers still believe that since financial advisors and other institutional investors will use traditional tools such as ETFs familiar to the financial world, Bitcoin spot ETFs will attract tens of billions of dollars in new investments. For individual investors, Bitcoin spot ETFs can make investing in Bitcoin easier, cheaper, and safer in some ways.
Seeing this, investors may be anxious to know what approval of a Bitcoin spot ETF will bring? What is the impact on related concept stocks?
What will Bitcoin spot ETF bring?
According to the Guosheng Securities Research Report, after summarizing the experience of gold ETF launch, U.S. Global Investors believes that after the launch of gold spot ETFs in 2004, gold prices rose 420% as liquidity and programmatic trading increased. The gold experience shows that spot ETFs are indeed very important, which provides an empirical reference and inspiration for the market impact after the launch of Bitcoin spot ETFs; therefore, it is believed that the launch of Bitcoin spot ETFs will also open up room for growth in related sectors.
It should be noted that the world's recognition of gold does not come from spot ETFs, and if a Bitcoin spot ETF is approved, it means that the huge traditional wealth world recognizes Bitcoin and even the Web 3.0 world, which will further accelerate the integration of the two. This is a process from 0 to 1, and the marginal changes far surpass the approval of a gold ETF. Of course, another level of difference is that the total number of bitcoins is fixed at 21 million, and gold is still being produced continuously.
According to the bank's research report, a Bitcoin spot ETF has been approved in the US and is expected to bring in a certain amount of incremental capital. Based on this calculation, Galaxy Digital came to the conclusion that the potential capital to invest in Bitcoin products is between 125 billion US dollars and 450 billion US dollars over a long period of time.
What do you think of the cryptocurrency concept stock market after the stock market?
According to a previous research report by Guosheng Securities, if a Bitcoin spot ETF is approved, its significance is not only to bring traditional financial capital to Bitcoin investment, but also to push traditional financial capital into the entire cryptocurrency market and even the Web 3.0 world. Therefore, it is recommended to focus on cryptocurrencies and listed companies related to Web 3.0.
Currently, there are four main types of relevant listed companies:
1) Computing power mining stocks: Bitcoin mining business through holding/hosting computing power;
$Bit Digital (BTBT.US)$,$Digihost Technology (DGHI.US)$,$Iris Energy (IREN.US)$,$Riot Platforms (RIOT.US)$,$Marathon Digital (MARA.US)$,$Bitfarms (BITF.US)$,$CleanSpark (CLSK.US)$,$Hive Blockchain (HIVE.US)$,$TeraWulf (WULF.US)$,$BIT Mining (BTCM.US)$,$Argo Blockchain (ARBK.US)$,$Bit Origin (BTOG.US)$,$Mawson Infrastructure (MIGI.US)$,$Bitdeer Technologies (BTDR.US)$
2) Mining machine manufacturers: R&D, production and sale of Bitcoin mining machines;
3) Crypto asset exchange: provides trading, custody, financial management and other services for crypto assets;
4) Cryptocurrency stocks: Bitcoin is used as the main allocation asset.
Judging from the post-market trend of concepts related to US stocks, it also confirms that approval of the Bitcoin ETF is expected to bring about a wave of growth.
However, there are also market opinions that in the short term, approval of a Bitcoin ETF is beneficial for attracting new investors into the coin industry. In the medium to long term, Bitcoin ETF will be an advantageous competitor to Coinbase due to easy transactions, low costs, and transparent fees, and the increase in escrow and supervision fees brought about by ETFs may not offset the decline in Coinbase's trading volume. This is not only bad for Coinbase, but also bad for other exchanges such as Binance.
In addition, investors should also note that the current regulatory policies for cryptocurrency and Bitcoin spot ETFs in various countries are still in the research and exploration stage, and there is no mature regulatory model, so the industry faces the risk of regulatory policy uncertainty.
Editor/Somer