Matrixport, a provider of cryptocurrency investment services, anticipates that the U.S. Securities and Exchange Commission (SEC) will likely decline all applications for the listing of a spot bitcoin exchange-traded fund (ETF) in the coming month.
Matrixport’s Analysis on Crypto ETF Impact and Gensler’s Compliance Stance
In a recent statement on Wednesday, the company highlighted the influential role of the current five-person voting Commissioners, emphasizing that the SEC’s leadership, predominantly composed of Democrats, holds a critical position in the approval process for ETFs. The firm expressed concern over SEC Chair Gensler’s lack of enthusiasm for cryptocurrency adoption in the United States, suggesting that the prospect of him endorsing bitcoin spot ETFs is uncertain and may be considered a remote possibility.
Matrixport further elaborated on the potential impact of an ETF approval, asserting that it could significantly boost the overall adoption of cryptocurrencies. Referring to Gensler’s comments in December 2023, the firm emphasized his belief in the industry’s requirement for more rigorous compliance measures.
The company speculated on the political dynamics at play, suggesting that there may be reluctance to approve a bitcoin spot ETF due to concerns about legitimizing Bitcoin as an alternative store of value.
Matrixport’s Insight on ETF-Related Capital Inflows
The widespread anticipation of the approval of a spot Bitcoin ETF in the U.S. played a pivotal role in driving Bitcoin prices to levels not witnessed since April 2022, concluding 2023 with an impressive gain of nearly 160%.
Matrixport offered an estimate, indicating that out of the additional $14 billion deployed into crypto since September, approximately $10 billion might be attributed to expectations surrounding the approval of an ETF.