Anticipating Bitcoin ETF Approvals
Standard Chartered Bank has released a report predicting a significant surge in the value of Bitcoin in the coming years. According to the report, the price of Bitcoin could reach up to $200,000 by 2025 if spot Bitcoin exchange-traded funds (ETFs) are approved by the U.S. Securities and Exchange Commission (SEC). The report, led by Head of Crypto Research Geoffrey Kendrick, draws parallels between the potential impact of Bitcoin ETFs and the historical influence of gold ETFs on the gold market.
Comparing Bitcoin ETFs to Gold ETFs
The report highlights the introduction of the SPDR Gold Shares (GLD) ETF in 2004 as an example of how ETFs can significantly increase investor access and result in substantial inflows. The total stock of above-ground gold was worth around $2.2 trillion at the time, compared to Bitcoin’s current market cap of $0.86 trillion. Adjusting for relative market caps, the report estimates that BTC ETFs could see inflows ranging from $34 billion to as high as $130 billion. The bank considers a range of $50-$100 billion to be a “reasonable” projection.
“The price of gold rose 4.3x in the seven to eight years it took for gold ETP holdings to mature after the first ETP was introduced. We expect Bitcoin to enjoy price gains of a similar magnitude as a result of US spot ETF approval,” the report states.
Standard Chartered Bank predicts that if the inflows materialize as expected, Bitcoin could experience similar price gains as gold did when the GLD ETF started trading. The report suggests that if the SEC approves Bitcoin ETFs, the price of Bitcoin could reach around $100,000 by the end of 2024, with a further surge to $200,000 by the end of 2025.
Consistent Market Predictions
The bank’s prediction aligns with other industry experts, including VanEck CEO Jan van Eck. In an interview with CNBC, van Eck stated that Bitcoin could reach an all-time high in 2024. He also emphasized the similarities between the performances of Bitcoin and gold, noting that both assets peaked in 2021 and have experienced strong rallies.
Additionally, major Bitcoin ETF issuers like Galaxy and Bitwise have made similar predictions, anticipating a significant pump in Bitcoin’s value once the pending ETF approvals are granted. The SEC is expected to make a decision on the applications on January 10th, with trading potentially starting as soon as January 11th if approved.
