Bloomberg ETF analyst Eric Balchunas evaluated the potential effects of a possible ETF approval on the market in a recent podcast. Balchunas suggested that if the SEC approves Spot Bitcoin ETF applications, it could potentially harm cryptocurrency exchanges in the long run.
Will Spot Bitcoin ETF Applications Receive Approval from the SEC?
The Securities and Exchange Commission (SEC) has previously rejected numerous Spot Bitcoin ETF applications, and SEC Chairman Gensler’s comments on Spot Bitcoin ETFs have dampened expectations of an imminent approval. However, recent developments such as BlackRock’s ETF application and Grayscale winning its SEC case have largely reversed this expectation.
Although the SEC has postponed ETF decisions, expectations of Spot Bitcoin ETF applications being accepted have significantly strengthened in recent times. Former SEC Chairman Jay Clayton, who served as the head of the SEC from May 4, 2017, to December 23, 2020, also suggested last week in his evaluation of Spot Bitcoin ETFs that applications could receive approval from the SEC.
What Impact Will a Potential ETF Approval Have on the Market?
Bloomberg ETF analyst Eric Balchunas assessed the potential effects of Spot Bitcoin ETF applications on the market. In a recent podcast, he argued that ETFs could be more cost-effective for investors, which could consequently disrupt cryptocurrency exchanges.
The Bloomberg analyst also noted that not all cryptocurrency exchanges have the same fee structure. He stated that the effects of ETFs on cryptocurrency exchanges could emerge within five years. Balchunas emphasized that a potential ETF approval poses a threat to exchanges and highlighted the high transaction fees charged by certain cryptocurrency exchanges, including Coinbase.
