BlackRock’s latest request for a spot bitcoin (BTC) fund will boost investor confidence in bitcoin and may even be the “best thing that could happen” to BTCaccording to some cryptocurrency industry observers… but others warn that it will come at a hidden cost.
During an interview on June 16, Galaxy Digital CEO Mike Novogratz said that approval of BlackRock’s ETF application would be “the best thing that could happen to BTC”.
“I say a Hail Mary every night Larry Fink and @blackrock take out a @bitcoin ETF,” Novogratz said in the Fox News segment., according to a tweet from host Liz Claman.
—Mike Novogratz (@novogratz) June 16, 2023
So fun to be on the @LizClaman show! And yes, @BlackRock getting a BTC ETF off the ground would be the best thing that could happen to BTC.
For his part, cryptocurrency analyst James Edwards of Finder.com – a financial product comparison website – told Cointelegraph that the timing of the BlackRock filing must provide “confidence” in both bitcoin as an asset and also Coinbase in its upcoming legal battle fight with the SEC:
“BlackRock’s willingness to push ahead with a bitcoin ETF at a time when the SEC is on the warpath against cryptocurrencies is very telling.. It shows confidence in bitcoin’s status as a commodity, rather than a value,” she said, adding:
“BlackRock is unlikely to pursue an ETF of this nature without serious consultation with regulators and confidence in bitcoin’s future legal status.”
BlackRock’s intention to use Coinbase Custody to control the funds should also be seen as a huge confidence boost for Coinbase as it prepares its legal defense, Edwards explained.
He added that BlackRock – the world’s largest asset manager – probably wouldn’t partner with Coinbase if they didn’t have “confidence” in Coinbase’s legal position.
Others argue that the latest moves by the traditional investment giant undermine the “ethos” of decentralized cryptocurrencies.or that the company can find a way to profit from retail investors.
“As good as this may be for institutional adoption of the space, it kind of violates the ethos; it’s a bit of a dishonest push away from the people who built the industry in the United States.”
Cinneamhain Ventures partner and Ethereum bull Adam Cochran believe that BlackRock will pounce on “discount coins” from retail investors, a theory also shared by Melker.
— The Wolf Of All Streets (@scottmelker) June 15, 2023
Steven Lubka, managing director of Swan bitcoin, shared a similar opinion, predicting that BTC will hit $1 million, but few retail investors would reap the rewards because most of the BTC will be owned by BlackRock, Goldman Sachs and other ETF issuers.
Melker added that Wall Street firms will continue to enter this space and that US regulators are likely to “pick them” over existing platforms.
ARK Invest, Grayscale, Fidelity, Galaxy Digital, VanEck, Valkyrie Investments, NYDIG, SkyBridge and WisdomTree are among the other investment firms that have filed with the SEC for ETFs similar to bitcoin and cryptocurrencies.
Since the news broke, the BTC price has risen 2.2% to $25,584 at the time of writing this article.
Curiously, the Cryptocurrency Fear and Greed Index increase from 41 to 47 -leaving the fear zone- after the news of the presentation of BlackRock.
Clarification: The information and/or opinions expressed in this article do not necessarily represent the views or editorial line of Cointelegraph. The information presented here should not be taken as financial advice or investment recommendation. All investment and commercial movement involve risks and it is the responsibility of each person to do their due research before making an investment decision.
Investments in crypto assets are not regulated. They may not be suitable for retail investors and the entire amount invested may be lost. The services or products offered are not directed or accessible to investors in Spain.