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ETF approval may boost Bitcoin’s liquidity, but it won’t be a game changer — JPMorgan

CryptofreePress Staff by CryptofreePress Staff
July 7, 2023
in Regulation
0
ETF approval may boost Bitcoin’s liquidity, but it won’t be a game changer — JPMorgan

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A doable approval of a spot Bitcoin exchange-traded fund (ETF) will not be a sport changer for crypto markets, though it would profit the main cryptocurrency, in line with a report by JPMorgan managing director Nikolaos Panigirtzoglou.

Primarily based in London, Panigirtzoglou is a part of JPMorgan’s world market technique crew. He believes {that a} Bitcoin ETF in the US would have the same affect on markets to these seen in Canada in Europe, the place spot Bitcoin ETFs have been round for a while.

In response to the report seen by Bloomberg, Bitcoin ETFs have total “attracted little investor curiosity” in different jurisdictions previously two years, additional “failing to learn from investor outflows from gold ETFs.”

The strategist additionally sees advantages of a Bitcoin fund receiving inexperienced lights in America. In response to Panigirtzoglou, an approval may convey extra liquidity to Bitcoin markets, however may additionally result in a migration of buying and selling exercise from BTC futures merchandise.

Panigirtzoglou’s view goes in a unique course from the excessive expectations that encompass an approval of a Bitcoin ETF in the US. Throughout an interview on July 6, BlackRock’s CEO, Larry Fink, urged that traders may flip to Bitcoin as a hedge in opposition to inflation and the devaluation of fiat currencies.

“Let’s be clear: Bitcoin is a world asset,” mentioned Fink, including that “It’s not primarily based on anyone forex, and so it might probably signify an asset that folks can play instead.” As reported by the Labor Division, the annual inflation price for the US was 4.0% for the 12 months ended Could.

BlackRock’s constant success in filling ETFs has led to optimism that its strive for a Bitcoin ETF may also succeed. In response to information from Eric Balchunas and James Seyffart at Bloomberg Intelligence, solely one among 550 funds filed by the corporate has been rejected to this point.

BlackRock’s utility was adopted by a wave of refilings with the Securities and Change Fee (SEC), with Investco, Constancy, WisdomTree and Ark Make investments among the many proponents in line for regulatory approval. A number of purposes have been denied by the SEC previously.

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