July 8

Spot Bitcoin ETF Approval May Not Be a Game Changer – JP Morgan


In a recently published report from JPMorgan, attention is drawn to the experiences of Canada and Europe, where spot Bitcoin ETFs have been available for some time but have failed to gain substantial investor interest. Nikolaos Panigirtzoglou, the managing director at JPMorgan, offers insights suggesting that even if a spot Bitcoin exchange-traded fund (ETF) is approved in the United States, it may not be a game changer for crypto market, despite the potential advantages it could bring to the leading digital currency.

Nikolaos Panigirtzoglou, a member of JPMorgan’s global market strategy team based in London, suggests that such approval could potentially inject more liquidity into Bitcoin markets, but at the same time, it may lead to a shift in trading activity away from BTC futures products.

As per information obtained by Bloomberg, the report reveals that Bitcoin ETFs in other jurisdictions have generally failed to pique significant investor interest over the past two years, failing to take advantage of the outflows from gold ETFs.

Furthermore, the strategist recognizes the potential advantages of a Bitcoin fund receiving regulatory approval in the United States. Panigirtzoglou shares the belief that a Bitcoin ETF in the United States would likely have a similar impact as its counterparts in Canada and Europe, where spot Bitcoin ETFs have been around for a considerable period.

Panigirtzoglou’s perspective on this matter differs from the high expectations surrounding a potential approval in the United States.

In a recent interview, Larry Fink, the CEO of BlackRock, hinted that investors might consider Bitcoin as a means to safeguard their investments against inflation and the devaluation of fiat currencies.

Fink stated, “Let’s be clear: Bitcoin is an international asset.” He further elaborated, that Bitcoin’s value is not reliant on any single currency, thereby positioning it as an asset that individuals can explore as an alternative investment option. The annual inflation rate for the U.S. was reported at 4.0% for the 12 months ending in May by the Labor Department.

Given BlackRock’s track record of effectively launching and filling ETFs, there is an optimistic outlook regarding the company’s potential success in securing approval for a Bitcoin ETF. Bloomberg Intelligence analysts Eric Balchunas and James Seyffart have provided data suggesting that out of the 550 funds previously filed by BlackRock, only one has been rejected so far.

Following BlackRock’s application, other industry players such as Invesco, Fidelity, WisdomTree, and ARK Invest have also submitted their filings to the Securities and Exchange Commission (SEC), seeking regulatory approval. It is worth noting that the SEC has previously denied several applications for Bitcoin ETFs.


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