Experts disagreed on how the launch of a Bitcoin ETF could affect the digital asset market and the behavior of the cryptocurrency rate.
After the approval in early 2021 of the launch in Canada of the first exchange-traded fund (ETF) based on the most capitalized cryptocurrency – bitcoin (BTC), members of the American crypto community predicted the imminent appearance of a financial instrument in the United States. At the same time, how exactly the derivative can affect the cryptoindustry is unclear.
The BeInCrypto editors asked experts to tell how the launch of a Bitcoin ETF in America could affect the behavior of the most important cryptocurrency and the digital asset market in general.
Positive predictions about the implications of the launch of a Bitcoin ETF in the US
EMFINANCE Director Evgeny Marchenko sees the advantages of launching a Bitcoin ETF. The expert noted that there are investors in the crypto industry whose risk profile is close to investing in cryptocurrency. Such market participants, Yevgeny Marchenko is sure, do not care about the volatility and insecurity of the asset – they are ready for speculative risk.
At the same time, the designated group of investors, according to the expert, is confused by the legislative mechanisms for regulating trade, the unproven security of crypto exchanges and crypto wallets. It is for such investors that, in his opinion, Bitcoin ETFs are ideal, since the format of an exchange-traded fund implies that all issues of asset safety will be resolved on the side of the provider.
“Accordingly, the launch of a bitcoin ETF on the largest stock market – on the American one – will provide an inflow of new funds into the cryptocurrency, which will push the asset price up and somewhat reduce its volatility,” summed up Yevgeny Marchenko.
Tatiana Maksimenko, the official representative of the Garantex cryptocurrency exchange, also sees advantages in launching a Bitcoin ETF in the United States. In her opinion, the approval of a financial instrument will be a signal to the entire market that a new asset has appeared on the arena, which cannot be ignored.
As a result, the news of the launch of a bitcoin ETF in the United States, Tatyana Maksimenko is sure, will give a very powerful impetus to the growth of the BTC rate, to the development of cryptocurrency technologies and the integration of digital assets into other traditional financial services.
“That is, the Bitcoin ETF will make BTC the mainstream in the world of finance, and not some amazing” animal “with the help of which the PR departments of banks increase citation in the media,” the expert explained her point of view.
Tatyana Maksimenko is confident that sooner or later the Bitcoin ETF will be launched in the United States. At the same time, the expert doubts that the event will take place this year.
“I think we have to wait another two or three years. Although everything is possible in the crypto world, everything is developing faster here than in other areas, so I do not exclude that the emergence of a bitcoin ETF is possible this year as well. At the same time, two or three years before the launch of the Bitcoin ETF is the most probable forecast, in my opinion, ”Tatiana Maksimenko summed up her point of view.
Bitcoin ETF could be a double-edged sword
Vladislav Akeliev, Director for Development of the ECOS Cloud Mining Service, an expert on tokenization and digitalization of business, shared his next opinion on the consequences of launching a financial instrument in the United States .
The expert is confident that the emergence of bitcoin ETFs will bring new investors to the market. The advantages of the new asset, in his opinion, will positively affect the price of the main cryptocurrency, giving bitcoin additional legitimacy and opening the market for traditional institutional investors.
“Also, the launch of ETF based on BTC will add liquidity to the crypto market, which is useful for the entire ecosystem,” Vladislav Akeliev is sure.
The expert considers the influx of new money into the cryptoindustry against the background of the launch of the bitcoin ETF as a positive factor. At the same time, Vladislav Akeliev warned that the emergence of a financial instrument could lead to the centralization of BTC, which contradicts the entire philosophy of the project.
“Potential owners of the new asset will not be able to vote, and it will be easier for governments to influence and regulate the market. This is not what the crypto community was heading towards, ”the expert explained his point of view.
In conclusion, Vladislav Akeliev noted that if the percentage of investors in bitcoin ETFs is not so large, then the appearance of a financial instrument could have a positive effect on the entire market. At the same time, a great demand for an asset, in his opinion, will lead the crypto community to work within a centralized and dependent system.
Expert Tradingview, Inc. Nikolay Korinets also believes that the launch of a bitcoin ETF can become a “double-edged sword” for the crypto community. The expert recalled how, at one time, the launch of Bitcoin futures in 2017 influenced the market.
In his opinion, at that time, not everyone understood that the launch of a financial instrument opened up more opportunities for a “short game” [ed. earnings from the fall in the rate of cryptocurrency], thanks to which market participants were able to “bring down” the cost of BTC.
At the same time, the launch of bitcoin futures in 2017, Nikolay Korinets is sure, at the same time, became a positive step towards the development of the digital asset market. All enthusiasts, as the expert noted, were simply delighted by the news that the cryptocurrency, albeit indirectly, appeared on serious exchanges.
“In the case of the actual launch of a bitcoin ETF, the same mechanics of traders’ behavior is very likely -“ bitcoin is now in the top league, so you have to buy it ”. The likelihood of such a scenario is indicated by the appearance on the market, since the launch of BTC futures, a large number of newcomers. At the same time, the initial speculative rise [of the bitcoin rate] may be followed by a decline in the future, “Nikolai Korinets summed up.
US Bitcoin ETF Launch Risks to Become Pass Through News
The head of the Cryptonisation project , Alexander Zyl, is not sure that the launch of a financial instrument in America can seriously affect the digital asset market. The expert noted that the Bitcoin ETF is a tool through which institutional investors can enter the cryptocurrency market.
In his opinion, the launch of an exchange-traded fund based on BTC would be relevant at a time when there were no alternatives for professional players to enter the crypto industry. Today, according to the expert, large investors already have other tools for investing in digital assets.
“There are many funds (like GrayScale) that allow institutional investors to invest in cryptocurrencies. Therefore, in my opinion, the launch of a Bitcoin ETF is not something very relevant and, most likely, it will not have a significant impact on the market, ”Alexander Zyl explained his point of view.
The results of the launch of the Bitcoin ETF in Canada in February 2021, in his opinion, suggest that the appearance of such a financial instrument in the United States will not be a significant event. In particular, the expert noted that the positive decision of the Canadian authorities on the fund traded on the exchange did not save bitcoin from a collapse from $ 57-58 thousand to $ 44 thousand for 1 BTC.
“As a result, I expect that the launch of the Bitcoin ETF in the United States will also have no impact on the market and the news will be ranked among the next,” summed up Alexander Zyl.
Recall that at the moment, many American companies are interested in taking first place in the Bitcoin ETF market in the United States. In particular, one of the world’s largest investment banks, Goldman Sachs, entered the race to launch a financial instrument.