Are New Bitcoin Spot Funds a Game Changer?
The Securities and Exchange Commission's approval of 11 bitcoin cryptocurrency ETFs this week could mark a turning point for investing in cryptocurrencies in general, and bitcoin in particular, its largest by price and market capitalization.
Last week, Cathy Wood, CEO of Arc Invest and the company's chief investment officer, which launched one of its new spot market ETFs, said: “We believe this is an important moment in democratizing access to Bitcoin. . . . people have access.”
Amid significant investor interest in cryptocurrencies, the first batch of spot ETFs began trading on Thursday. The period leading up to the historic approvals to launch the funds saw a significant rise in the price of the most popular cryptocurrency, which at the start of trading on Friday was up more than 125% over the past 12 months.
Wood said that as financial institutions begin to gain more exposure to the cryptocurrency market, through new funds, the impact on the price of Bitcoin will be noticeable.
“If companies managing trillions of dollars put in just 0.2% or 0.5%, it can make a real difference,” he added.
21.co is heavily involved in the cryptocurrency space. According to its website, the company is “bridging the gap between traditional finance and decentralized finance to make cryptocurrencies more accessible.”
“The new boxes will be a key part of a new wave of revolutionary technology,” said Ophelia Snyder, the company's president and co-founder. Snyder emphasized that Bitcoin is more than a new asset class.
“It really has a long way to go in terms of how it interacts with our kind of economic systems around the world and, frankly, with investors' portfolios,” he said.
Snyder also said the impact that large-scale access to bitcoin could have on the market “can't be underestimated.”