'Deniers Are Crypto's Flat Earthers' as Markets Flash 83% Odds of Bitcoin ETF Approval (2024)

FAQs

Did bitcoin ETF approval odds raised to 90% by Bloomberg analysts drop on polymarket? ›

Odds of a spot bitcoin (BTC) exchange-traded fund (ETF) being approved in the U.S. have risen to more than 90%, two influential analysts at Bloomberg said, while crypto market participants at betting platform Polymarket became more pessimistic, trimming the odds to 85%. For full coverage of bitcoin ETFs, click here.

The primary risk of spot Bitcoin ETFs lies in Bitcoin's inherent volatility, which can lead to significant fluctuations in the ETF value. Investors must be prepared for rapid price changes and potential losses. Additionally, ETF management involves fees, such as expense ratios, which can impact overall returns.

Yes and no. There were already crypto-related ETFs and trusts out there, but there had never been a spot Bitcoin ETF on the market before the Jan. 2024 approval. These recently approved ETFs are the first cryptocurrency funds to trade on a major exchange and hold Bitcoin directly.

Increase prices.

While a spot bitcoin ETF does not directly affect the price of bitcoin, the increased demand and purchasing of bitcoin by these ETFs could boost the price over time.

The approval of the application and effectiveness of the registration statement will allow GBTC to operate as a spot Bitcoin ETF and will make it among the first such products to be brought to market in the U.S. GBTC shares will be listed on NYSE Arca under the Ticker: GBTC.

Possible Reasons for the Price Decline

Profit-Taking: The anticipation of ETF approvals likely fueled a run-up in Bitcoin's price. Once the approval was confirmed, investors may have decided to lock in profits, leading to a sell-off. Market Expectations vs.

If long-term price performance is your only investment goal, then the new Bitcoin ETFs make a lot of sense. However, you could prefer direct-asset ownership of Bitcoin if you are concerned about the regulatory or legal aspects of crypto.

Key Takeaways. ETFs can be safe investments if used correctly, offering diversification and flexibility. Indexed ETFs, tracking specific indexes like the S&P 500, are generally safe and tend to gain value over time. Leveraged ETFs can be used to amplify returns, but they can be riskier due to increased volatility.

Spot Bitcoin ETFs directly hold Bitcoins, but derivatives-based Bitcoin ETFs use financial instruments like futures contracts to replicate Bitcoin's prices. Spot Bitcoin ETFs thus have direct ownership of Bitcoins.

Clients looking for spot bitcoin ETFs or spot ether ETFs can find these and other third-party ETF and mutual fund products available at Schwab.

What is the disadvantage of Bitcoin ETF? ›

Disadvantages of Crypto ETFs

1 When buying shares of an ETF, you pay your brokerage's trade fees and the fund's expense ratio. Crypto ETFs have expense ratios from 0.39% to 1.5%, much higher than the transaction fees charged by crypto exchanges. 9.

There are a few important considerations when choosing which Bitcoin ETF you want to purchase. The first thing to look at is each issuer's annual management fee. The current ETF offerings range in fees from 0.21 – 1.5%, with ARK Invest as the cheapest and Grayscale as the highest.

Coinbase is serving as the custodian for eight of the new bitcoin ETF entrants, including BlackRock's (BLK) iShares Bitcoin Trust (IBIT), the ARK 21Shares Bitcoin ETF (ARKB), Bitwise Bitcoin ETF (BITB), as well as Grayscale (GBTC), which converted its bitcoin trust to a spot bitcoin ETF.

Fees tend to be higher than other ETFs. Investors do not own the cryptocurrency directly, and they must defer to the fund's management strategy. Unlike cryptocurrencies, ETFs can only be traded during market hours. Crypto markets on which the ETFs are based still largely unregulated.

The Securities and Exchange Commission (SEC) rejected spot bitcoin ETFs for more than a decade, hoping to protect investors from market manipulation. But the SEC was forced to approve them last month after Grayscale Investments won a court challenge.

Bitcoin slid to its lowest price since mid-December as the speculative demand for the token triggered by hype about new exchange-traded funds dissipates, leaving the cryptocurrency in the red since the start of 2024.