Analysts expect 10-20% of the Gold ETF money moving into Bitcoin post the BlackRock ETF approval i.e. $12 billion to $14 billion worth of inflows in BTC.
The entire crypto community remains excited regarding the approval of the spot Bitcoin ETF, with huge expectations ahead from BlackRock. This is because it would trigger a new source of demand for Bitcoin, leading to a strong price impact for the asset class.
“One of the most significant developments in the cryptocurrency space is unfolding, prompting the question: What is the potential size of Bitcoin’s price and market cap post-BlackRock ETF approval?” TheStreetCrypto’s Austin Arnold said.
In further exploration, his brother and Alcoin Daily co-host Aaron Arnold delved into the potential implications of approval, considering the various sources of demand for Bitcoin investment. He sought to provide a comprehensive understanding of how the entry of more institutional buyers might reshape the landscape.
“Where will this demand originate?” he inquired. “From institutional investment entities like BlackRock, Fidelity, and Charles Schwab; corporate treasuries such as MicroStrategy and Tesla; as a means for remittances, facilitating money transfers domestically and internationally.
He also cited other reasons such as the involvement by state treasuries, including those of the US, China, and Russia; adoption as an emerging market currency; its use in economic settlement, including US banks; and as a store of value resistant to confiscation. Notably, the role of Bitcoin as a digital gold stands out as a significant factor in this context.
How Will BTC Price React after BlackRock Bitcoin ETF Approval?
Well, one of the biggest debates currently in the market is how the Bitcoin price would react after the Bitcoin ETF approval. Crypto market analysts seem to be divided over this. Some believe that the Bitcoin ETF approval has been already priced in. On the other hand, some analysts believe that Bitcoin would see major inflows from other asset classes such as Gold.
Based on his research, Austin Arnold pointed out that Galaxy Digital anticipates an influx of $14 billion into a BlackRock ETF, potentially resulting in a 75% increase in price. The reasoning presented by the crypto service provider, Matrixport, is compelling.
They suggest that if investors who traditionally allocate 10% to 20% of their funds to a gold ETF were to direct a similar portion into a Bitcoin ETF, it could amount to around $12 billion to $24 billion entering the Bitcoin ETF market. This influx of capital could conservatively drive Bitcoin’s price to approximately $44,000, with the possibility of reaching as high as $56,000.
Taking into account the recent surges in Bitcoin’s price as a response to favorable spot ETF approval news and the growing data reflecting increased institutional involvement. Thus, it becomes evident that the endorsement of a BlackRock ETF will serve as a catalyst for driving Bitcoin’s price in an upward direction.