BlackRock's Bitcoin ETF Approval Potentially Encourages BTC Price Increase

Bitcoin. (Photo; Doc. Unsplash)

JAKARTA - A recent report from Matrixport, a crypto financial services platform, shows that BlackRock's Bitcoin Exchange Exchange Exchange Fund (ETF) approval has the potential to push the price of Bitcoin (BTC) up to around $42,000 (Rp667 million) to $56,000 (Rp889 million).

This report is not merely speculation. History has proven that the traditional ETF approval is often accompanied by increased investor interest and a surge in the price of the underlying asset. ETF can facilitate institutional investor access to the Bitcoin market, which has the potential to direct the flow of funds to the market.

One of the main indicators of crypto market growth is the performance of the Bitcoin Trust of Grayscale Investments (GBTC). Currently, GBTC's share price has increased by 167% on an annual basis, surpassing Bitcoin's 71% growth in the same period. This shows an increased interest from the institution in the crypto world.

A significant change occurred when BlackRock Inc. submitted the ETF app in June. This announcement has rocked the crypto market and has the potential to change its landscape.

Matrixport analysis shows that if Tether's market cap (USDT) increases by $24 billion (Rp381 trillion), which acts as a proxy for potential inflows to ETF, the price of Bitcoin could reach $42,000 (Rp667 million). However, if the inflow reaches $50 billion (Rp794 trillion) due to a 1% allocation suggestion by the Registered Investor Advisor (RIA), Bitcoin has the potential to reach $56,000 (Rp889 million).

The RIA community in the United States, which consists of around 15,000 people and oversees assets worth around $5 trillion, has great potential to influence investment decisions and asset allocations. The report estimates that simple recommendations for a 1% allocation to Bitcoin by RIA could direct around $50 billion (Rp79.4 quadrillion) to the crypto market.

Although the crypto community is awaiting approval from the Bitcoin ETF, the Chairman of the United States Securities and Exchange Commission (SEC), Gary Gensler, recently stressed that the application is not just a formality, but must go through a thorough review process in various SEC divisions.