Sunday, 05 July 2020

Bitcoin to $100,000 on ETF approval?

A Bitwise/ETF Trends survey of US financial advisers on their attitudes to cryptoassets provides some useful insights.

Only 16% said their preferred vehicle for holding crypto would be directly in a crypto wallet, while a large majority – 65% – are waiting for an exchange traded fund to be approved by the US Securities and Exchange Commission (SEC), with 9% preferring open-ended funds.

Advisers in the survey are bullish on bitcoin, with 64% expecting the price to rise over the next five years, and 37% expecting the price to be between $10,000 and $24,000.

The survey was based on 415 advisers, of whom 76% said they had received questions from their clients about cryptocurrencies in 2019.

Those advisers expecting to allocate to crypto on behalf of clients more than doubled from 6% to 13%.

Tony Sagami at Weiss Ratings says the survey strongly supports the view that ETF approval by the SEC would be a massive price driver, leading him to claim: “$100,000 per Bitcoin is not out of the question. In fact, that may be too conservative.”

The SEC has shown no indication that it will approve a bitcoin ETF anytime soon.

Grayscale scoops up institutional buyers

Perhaps a better guide as to whether institutional interest is on the up comes from the US-based Grayscale Investment’s annual Digital Asset Investment Report.

Inflows to the crypto investment firm in 2019 came in at $607.7 million, a sum greater than the cumulative investment for the prior six years ($565.8 million).

Not all of the 2019 total was in bitcoin via investment in its Grayscale Bitcoin Trust. 22% of investment went into other cryptoasset – mostly digital application platform Ethereum.

The report provided a breakdown of the type of investor, with institutional accounting for 71% of those investing in 2019. The remainder were 19% accredited investors, 7% retirement accounts and 3% family offices.


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