The price of Bitcoin (BTC) could rise to $56,000 if the US Securities and Exchange Commission (SEC) approves BlackRock’s application for a spot exchange-traded fund (ETF), according to an October 19 research note from Matrixport shared with CryptoSlate.
The prediction is based on the projection that the US Registered Investor Advisor (RIA) community, which oversees approximately $5 trillion in assets, would allocate 1% of their holdings to BTC, which could herald as much as $50 billion for the sector.
A more conservative estimate from the crypto platform predicted that the value of the top cryptocurrency could rise to $42,000 if the asset witnesses significant inflows between $12 billion and $24 billion from 10-20% of precious metals ETF investors holding want to diversify their portfolios through a Bitcoin ETF.
Bitcoin Market Cap to $900 Billion: CryptoQuant
The prediction follows a similar prediction from crypto analysis company CryptoQuant wrote that a spot approval of BTC ETF would push the flagship’s market cap to $900 billion. By comparison, the broader crypto market could grow by $1 trillion.
According to CryptoQuant’s prediction, the price of BTC could rise to a range of $50,000 to $73,000 if ETF applicants allocate just 1% of their Assets Under Management (AUM) to these funds.
CryptoQuant argued that capital inflows from spot ETFs could substantially exceed the capital inflows that Grayscale’s Bitcoin Trust (GBTC) experienced during the previous bull market. According to the company, these companies integrated BTC into their balance sheets in the first phase of institutional adoption. However, in the subsequent phase, financial institutions can facilitate customer access to the asset through spot ETFs.
‘Pent-up demand’
These companies’ predictions are consistent with the market’s reaction to a false report of a spot BTC approval. Following the news, BTC briefly jumped to $30,000 before returning to its current value.
BlackRock CEO Larry Fink said the market reaction was “an example of the pent-up interest in crypto” and evidence of a “flight to quality.”
This view was also shared by several market observers who believe that a spot BTC ETF approval would push the asset’s value to new highs.
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