The cryptocurrency market is on the threshold of a significant transformation with the potential approval of the spot Bitcoin exchange-traded fund (ETF), as stated by Hassan Ahmed, the head of Coinbase in Singapore. During an appearance on CNBC International on January 2, Ahmed emphasized the importance of Bitcoin ETFs to the digital financial ecosystem.
Ahmed stressed that Bitcoin ETFs are more than a passing trend. They represent an opportunity to funnel trillions of dollars into the crypto sector, which has until now been limited by restricted access to this asset class. The SEC’s approval of a spot Bitcoin ETF is seen as a catalyst for structural market change, providing a regulated path for significant investments to enter the industry.
The Coinbase executive noted that the US regulatory body SEC is laying the groundwork for approval of ETFs, which have been in development for more than a decade. There is an expectation that the SEC will provide updates to the industry by the January 10 deadline. Ahmed suggested that the SEC is unlikely to reject spot ETFs, given its previous approval of future Bitcoin ETFs.
Hassan Ahmed, the head of Coinbase in Singapore appearing on CNBC International. Source: CNBC/Youtube.
“SEC likely to approve Bitcoin spot ETF,” according to Coinbase executive
The structural similarity between spot and futures ETFs makes it difficult for the regulator to justify continuing to reject them, according to Ahmed. He added that the SEC’s recent actions indicate a possible positive outcome, although nothing is guaranteed at this time.
Ahmed also highlighted the role of Bitcoin ETFs in destigmatizing and legitimizing Bitcoin for institutional investors such as wealth and asset managers in the US. The approval of these ETFs could mean an increase in demand for the flagship cryptocurrency, leading to substantial market growth.
Furthermore, Ahmed pointed to two main factors that could boost Bitcoin in 2024: an increase in demand and a reduction in supply due to the upcoming halving event. He also mentioned the growing interest in Bitcoin block space due to ordinals and inscriptions. Thus, increasing BTC transaction fees to a relative high since 2020.
This potential approval of the Bitcoin ETF is a pivotal moment for the cryptocurrency sector, indicating growing acceptance and institutional interest in digital assets. In this way, the development could provide a regulated and familiar channel for asset managers and allocators to interact with the digital asset class.
The views and opinions expressed by the author, or anyone mentioned in this article, are for informational purposes only and do not constitute financial, investment or other advice. Investing or trading cryptocurrencies carries a risk of financial loss.