Bitcoin ETF - Hype Versus Real Expectations
As part of its Webinar Series, Valmar was privileged to explore the historic BTC ETF approval with Bitwise Asset Management, Franklin Templeton, and FalconX. We looked back at history to understand its origins and careful planning, discussed its relevance and importance for the current market, and spoke about long-term implications.
Particularly relevant highlights included:
The first application for BTC ETF was by the Wink Twins back in 2013 - this has been a long journey that has built upon unsuccessful launches and did not simply develop overnight.
BTC ETF products provide a broad variety of investors a readily-accessible and secure way to gain access to BTC via a clean structure from highly-trusted market participants.
Thus far, the ETF launch is experiencing tremendous inflows relative to other ETFs and hitting its own records week-over-week. Despite this record activity, flow has mostly been retail and hasn’t attracted the RIAs or majority of institutions YET - this is expected to follow and to generate another massive wave of inflows (Carson Group (RIA) has approved four BTC ETFs).
The BTC ETF launch will serve as a natural springboard for the expansion of other products in the market, particularly options. Market-neutral strategies should be beneficiaries of that product boon as additional arbitrage opportunities also open.
The ETF will play a significant role in smoothing volatility around BTC.
Eyes and ears are tuned to May 23rd for the SEC’s answer to the ETH ETF applications, which have their own set of unique considerations. The SEC’s verdict quite possibly could be split again - 2 yes and 2 no - with Chairman Gensler responsible for breaking that split.
We would like to thank Megan Rust (Franklin Templeton), Jeff Park (Bitwise), and David Lawant (FalconX) for their keen insights and expertise. A replay can be found here.