Spot Bitcoin ETFs: Crypto market severely underestimates their bullish potential.

The cryptocurrency market is currently underestimating the potential impact of a spot Bitcoin (BTC) exchange-traded fund (ETF) approval, according to analysts from crypto research firm K33. In a recent market report, senior analyst Vetle Lunde and vice president Anders Helseth stated that the chances of a spot Bitcoin ETF approval have significantly improved in the last three months, even though the sentiment in the market has not been reflected in the price of Bitcoin or other cryptocurrencies.

The analysts pointed out that although Bitcoin had lost most of its gains following Grayscale’s legal victory over the Securities and Exchange Commission, an approval of a spot ETF would attract substantial inflows and create significant buying pressure for Bitcoin. They argued that the downside of a potential spot ETF rejection would be negligible, as Bitcoin prices would likely continue with business as usual.

Furthermore, Lunde and Helseth disagreed with the market’s outlook on ETFs, stating that the increased likelihood of spot ETF approvals, with some Bloomberg analysts predicting a 75% chance of approval within the year, indicates that the market is fundamentally incorrect in its perception. They emphasized the importance of aggressively accumulating BTC at current levels, describing it as a buyer’s market.

To support their bullish prediction, the analysts highlighted the recent 2% gain in the tech-heavy Nasdaq-100 index, which is often seen as an indicator of the broader market’s risk appetite.

In addition to their positive outlook on Bitcoin, Lunde and Helseth expressed optimism for the price of Ether (ETH). They believe that ETH is likely to outperform Bitcoin over the next two months due to strong momentum prompted by a futures-based ETF listing. Drawing a parallel with Bitcoin’s performance leading up to the launch of the first Bitcoin futures-based ETF in October 2021, the analysts suggested that Ether may follow a similar path.

The verdict on a futures-based Ether ETF is expected to be announced in mid-October, and it is reportedly set to receive approval from the SEC. This further adds to the positive sentiment surrounding ETH’s future performance.

In conclusion, K33 analysts argue that the potential approval of a spot Bitcoin ETF is highly underestimated by the crypto market. They believe that an approval would attract substantial investment and significantly increase buying pressure for Bitcoin. Additionally, they are optimistic about the price of Ether and expect it to outperform Bitcoin in the coming months. The market’s perception of ETFs is seen as fundamentally incorrect, and the analysts recommend aggressively accumulating BTC at current levels.

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