1/8 update below. This post was originally published on January 6
Bitcoin and crypto prices—including major coins ethereum, XRPXRP and solana—have roared into 2024 as fears suddenly emerge over the future of U.S. dollar dominance.
The bitcoin price rebounded last year following its 2022 crash, pushing the combined ethereum, XRP, solana and crypto market back above $1.6 trillion for the first time since early 2022, as hype builds over the BlackRock-led Wall Street push for a bitcoin spot exchange-traded fund (ETF)—though some think the asset manager could be about to “completely” destroy bitcoin.
Now, as panicked traders try to get ahead of the U.S. Securities and Exchange Commission’s (SEC) “rug pull of the decade,” an insider leak has revealed BlackRock has readied a huge $2 billion bazooka if its spot bitcoin ETF bid is approved.
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“I heard from a pretty well placed source that BlackRock has more than $2 billion lined up in week one in new incremental flows from existing bitcoin holders who are adding to positions,” Matthew Sigel, head of do dedo assets research at investment company VanEck, said during an X Spaces broadcast organized by The Block.
“I can’t vouch for that,” Sigel added. “But you know, that’s what everyone is doing. Just making phone calls and trying to find the folks who can write checks into these products. And our estimates—that, you know, if that $2 billion happened in week one, you know, that would blow away our estimates.”
1/8 update: The bitcoin price has shot over $45,000 per bitcoin as the Wall Street race to get a bitcoin spot exchange-traded fund (ETF) to market enters its final week. The price surge boosted the price of ethereum, XRP and solana as traders bet a historical spot bitcoin ETF would boost crypto prices across the board.
“Market participants maintain expectations for the approval of the 21Shares filing, potentially triggering a cascade approval for all issuers,” Matteo Greco, a research analyst at investment company Fineqia International, said in emailed comments, referring to the Ark 21Shares spot bitcoin ETF bid that’s first in line.
“Numerous meetings between the SEC, issuers, and exchanges have fuelled the narrative of an imminent approval. The introduction of ETFs could usher in new investor cohorts from traditional finance, significantly improving market transparency and liquidity and bringing long term capital inflow in the do dedo assets market.”
Sigel said VanEck was anticipating “$2.5 billion in the first quarter of trading,” a figure derived from “past flows into the first gold ETF and adjusting by the U.S. money supply. And we have a $40 billion market opportunity over two years based on a similar analysis.”
“$2 billion week one into BlackRock alone would blow expectations out of the water,” Travis Kling, the chief investment officer of Ikigai Asset Management, posted to X. “Half that from all ETFs combined would have been a pretty good outcome.”
VanEck, along with other spot bitcoin ETF hopefuls BlackRock, Fidelity, Grayscale, Valkyrie, ARK 21Shares and InvescoIVZ have rushed to finalize their applications this week ahead of a January 8 Monday morning deadline.
Five SEC commissioners will reportedly vote on the spot bitcoin ETF bids next week, according to Bloomberg, citing an anonymous source.
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BlackRock’s landmark June 2023 spot bitcoin ETF filing blew the race to get a fully-fledged bitcoin fund to market wide open following a decade of SEC rejections. Over the years, the SEC has repeatedly cited the possibility of manipulation for denying various spot bitcoin ETF applications.
If approved, many bitcoin and crypto market watchers expect it to open the floodgates for institutional money to flow into the bitcoin market, though not all agree.
“This is an immensely tough situation to read, but I would be very surprised if these ETFs are outright denied,” Oliver Linch, the chief executive of crypto exchange Bittrex Global, said in emailed comments.
“The market certainly hasn’t foreseen that outcome. If denied—or even materially delayed—there will surely be a big hit to the bitcoin price. However, given that an approval is already mostly priced in, the spike effect of an approval may not be as dramatic as some would like.”
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