The global crypto market has witnessed a significant milestone as Exchange-Traded Products (Crypto ETPs) worldwide have exceeded $50 billion in assets. This surge is largely attributed to the growing interest in Bitcoin (BTC) and Ethereum (ETH) products.
The approval of Bitcoin (BTC) Spot Exchange-Traded Funds (ETFs) has been a game-changer, with Coinbase stating that the approval is already partially priced in. Spot-based ETFs are expected to unlock floodgates for mainstream money. However, the flows are likely to materialize over time.
BitMEX, a leading cryptocurrency exchange, has warned that the success of Traditional Finance (TradFi) asset managers like BlackRock with spot Bitcoin ETFs could potentially disrupt the crypto market. The exchange believes that if these ETFs are highly successful, they could completely transform the Bitcoin market.
Crypto ETPs and CEXs, Potential ETFs’ Victims
The crypto community is eagerly awaiting the possible approval of a spot Bitcoin (BTC) exchange-traded fund (ETF) in the United States. Some analysts predict that a spot BTC ETF could start trading in early 2024. This event, coupled with Bitcoin’s upcoming block reward halving expected in April, could propel BTC to new heights.
However, the forecast isn’t that optimistic for centralized cryptocurrency exchanges. According to ETF Store president Nate Geraci and Bloomberg ETF analyst Eric Balchunas, the approval of a potential spot Bitcoin ETF in the U.S. would be a “bloodbath” for cryptocurrency exchanges. They believe that a spot Bitcoin ETF will create more price competition in the crypto industry, bringing money back to investors from exchanges that spend massive amounts of cash to advertise their services.
In conclusion, the rise in Crypto ETPs worldwide exceeding $50 billion in assets marks a significant milestone in the crypto industry. The potential approval of spot Bitcoin ETFs could further boost this growth, although it may pose challenges for crypto exchanges. As the cryptocurrency market undergoes continuous transformation, monitoring the progression of these changes will indeed be intriguing.