Crypto News – A few analysts caution that the cryptocurrency community may see unintended consequences for cryptocurrency exchanges if a spot Bitcoin exchange-traded fund (ETF) is approved in the US, as the community is excitedly anticipating.
Spot Bitcoin ETF Bloodbath: Analysts Predict Unintended Consequences for Crypto Exchanges
According to several industry watchers, when combined with the anticipated April block reward halving for Bitcoin, as noted by Blockstream CEO Adam Back, a spot BTC ETF may begin trading in early 2024. This might push BTC beyond $100,000. Those who support Bitcoin, including Samson Mow, CEO of Jan3, have stated that in the “days to weeks” that follow the U.S. approval of a spot Bitcoin ETF, the price of Bitcoin might even reach $1 million.
However, according to Eric Balchunas, an ETF analyst at Bloomberg, and Nate Geraci, president of ETF Store, the outlook for centralized cryptocurrency exchanges is not particularly rosy. On December 17, Geraci stated on X that if a possible spot Bitcoin ETF were authorized in the US, it would be disastrous for cryptocurrency exchanges.
Retail spot Bitcoin ETF buyers and sellers will profit from institutional trade execution and commissions, claims Geraci. However, Geraci noted that in order to compete with a spot Bitcoin ETF, retail trade execution and commissions—which are provided to users of cryptocurrency exchanges—will need to improve.
Balchunas Believes Next Super Bowl Will Be The Last Crypto Super Bowl If ETFs Are Approved
Eric Balchunas, an ETF analyst at Bloomberg, said that the typical trading charge for an ETF is 0.01%, which is what a spot Bitcoin ETF will cost to trade. If authorized, a spot Bitcoin ETF will increase price competition in the cryptocurrency space and reimburse investors of exchanges that fork over large sums of money to promote their products at events such as the Super Bowl, according to Balchunas.
It would be the last ‘Crypto Super Bowl’ if they launch ETFs, because ETFs are such a thin, rough industry and some of these crypto exchanges were sort of selling populism making a ton of money on their really high fees,
Balchunas
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