Teddy Fusaro, president of Bitwise, one of the crypto index fund managers, has praised the business model of Tether, the company behind the largest stablecoin in the crypto market. Fusaro emphasized that Tether obtained net income numbers close to the ones of traditional institutions such as Goldman Sachs and Morgan Stanley in 2023, with a […]
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Over the last week, Bitcoin (BTC) investors enjoyed much profit as the crypto asset gained 9.34% to trade above $71,000 based on data from CoinMarketCap. Currently, most of the BTC market is highly expectant of the potential large price gains that the current bull cycle could present.
However, commenting on the immediate future, Bitwise CEO Hunter Horsley has stated that the upcoming halving event – a key part of the bull cycle – could be the most significant in Bitcoin’s trading history as a result of an impending massive decline in the token’s supply.
In a post on X on March 29, Hunter Horsley shared that the Bitcoin Halving event slated for April 2024 could have the most profound supply and demand effects recorded ever in the asset’s history. For context, Bitcoin halving is a phenomenon that occurs every four years in which the block reward for BTC miners is reduced by half.
The April 2024 Bitcoin halving may be the most impactful we’ve seen. Why?
The last Bitcoin halving, 2020, Bitcoin was at ~$9,000. So the supply reduction in $ terms was ~$9M a day, and ~$3B a year.
This halving with Bitcoin ~$70,000, it will be >3x greater in $ terms: ~$32M a…
— Hunter Horsley (@HHorsley) March 29, 2024
Horsley began his prediction by referencing the last Halving in 2020, during which BTC’s price was ~$9,000. The Bitwise CEO stated that Bitcoin experienced a significant decline in token supply following the Halving effect, to the tune of ~$9 million per day and ~ $3 billion per year.
Considering that Bitcoin’s price currently hovers around $70,000, Horsley believes that the expected supply reduction will likely be at least three times larger in dollars and is estimated to be $32 million per day and $11 billion.
With a higher Bitcoin price, Horsley predicts that the expected massive decline in Bitcoin’s supply will be accompanied by a greater decrease in natural selling pressure by miners. In addition, the Bitwise CEO notes this development will concise with the current rise in institutional demand.
Generally, all factors highlighted by Hunter Horsley indicate that Bitcoin will likely experience a magnanimous price surge following the Halving event. Earlier in February, the Bitwise boss predicted BTC could attain $250,000 sooner as a result of investor demand driven by the introduction of the Bitcoin spot ETF.
At the time of writing, BTC is exchanging hands at $70,000 with a 0.65% loss on the last day. The widely acclaimed “digital gold” is up now by 10.45% on its monthly chart following the price correction in February,
Meanwhile, the BTC’s trading volume has declined by 23.16% and is valued at $24.67 billion. With a market of $1.1 trillion, Bitcoin ranks as the largest cryptocurrency in the world.
BTC trading at $69960 on the hourly chart | Source: BTCUSDT chart on Tradingview.com
Featured image from Forbes, chart from Tradingview
Disclaimer: The article is provided for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.
In a recent appearance on CNBC’s ‘Halftime Report,’ Matt Hougan, Chief Investment Officer (CIO) of Bitwise Asset Management, shared insights into the burgeoning interest and adoption of spot Bitcoin Exchange-Traded Funds (ETFs). This discussion comes at a time when BTC has shattered expectations, reaching a new all-time high of nearly $72,500.
Bob Pisani of CNBC highlighted the unprecedented influx of approximately $20 billion into the market following the mid-January launch of 10 new spot Bitcoin ETFs, including $1.3 Billion in Bitwise‘s own BITB. This move has significantly broadened the investor base for Bitcoin, attracting a diverse group ranging from retail investors and registered investment advisors to hedge funds and venture capital funds.
According to Hougan, “It’s sort of everyone everywhere all at once,” indicating a widespread and multifaceted demand for BTC exposure through these ETFs. He further revealed that “right out of the gate, the initial buyers are retail investors, registered investment advisors, but we’re also seeing hedge funds, venture capital funds, and others lining up.”
Crucially, Hougan pinpointed the near-future potential for a significant expansion in the investor base for Bitcoin ETFs. He foresees major wealth management platforms — the likes of Morgan Stanley and Wells Fargo — opening up to these ETFs, which would mark a pivotal moment in cryptocurrency investment.
“Soon, we think we’ll unlock major wealth management platforms, the Morgan Stanley‘s and Wells Fargo’s, and we’re even seeing corporations lining up to get into these funds. So a lot of the floodgates are open, not all of them,” he explained. This anticipated shift is expected to unlock “massive flows” into Bitcoin ETFs, as advisors on these platforms may soon begin recommending Bitcoin exposure to their clients.
“But we think in the next weeks or months, and it could be as soon as weeks, you’ll start to see these major wirehouses allow solicited investing into these Bitcoin ETFs means that the advisors can suggest to their clients that it might be helpful for their overall portfolio to add a small amount of Bitcoin exposure,” Hougan added.
Hougan’s statements underline a critical evolution in the perception and accessibility of Bitcoin as an investment vehicle. The broadening investor base, initially dominated by retail and institutional investors, is on the cusp of welcoming major wealth management platforms and their clientele into the fold.
This transition, according to Hougan, could significantly amplify the capital flowing into Bitcoin ETFs, thereby increasing BTC’s integration into mainstream investment portfolios.
Addressing concerns about the notorious volatility of BTC, Hougan argued that Bitcoin is “its own asset” currently in a phase of price discovery. He stressed the maturity of investors in this space, saying, “if you strip out GBTC…investors added exposure when the price went from $50,000 down to $39,000, and they’ve added exposure as it’s gone up to $72,000.”
This steady investment behavior, even in the face of volatility, indicates a strong belief in the long-term value of Bitcoin. “They’re just steadily adding to Bitcoin exposure and that gives me confidence that they’re here to stay. I think most of them are long-term investors in the space,” Hougan concluded.
At press time, BTC traded at $71,597.
Featured image created with DALL E, chart from TradingView.com
Disclaimer: The article is provided for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.
The chief investment officer at Bitwise Asset Management has explained why the current bitcoin bull market differs from prior bull markets. He doesn’t expect the bull market or the alts season to “end early,” emphasizing that he expects to see “more of an ‘everything season,’” rather than a classic alts season. Bitwise’s CIO Predicts an […]
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Bitwise chief investment officer Matt Hougan attributed the recent decline in the crypto market to overinflated expectations regarding the potential impact of the newly launched Bitcoin exchange-traded funds (ETFs).
In a Jan. 23 post on X (formerly Twitter), Hougan explained that the current market sell-off is driven by what he terms an “ETF Expectations-led” phenomenon.
According to him, investors anticipating “larger net flows into (these) ETFs” front-ran the approval news by piling into both spot and derivatives positions on the flagship digital asset. However, with the expected inflows not materializing, these investors are now “unwinding that bet,” prompting the current market situation.
“Just as the market overestimated the short-term impact of ETFs, it is underestimating the long-term impact,” Hougan concluded.
Since the Securities and Exchange Commission (SEC) approved the launch of several spot Bitcoin ETFs in the U.S., the value of the top cryptocurrency has been on a downturn. The digital asset fell to as low as under $39,000 on Jan. 23 but has recovered to $40,389 as of press time, according to CryptoSlate’s data.
This downward trend raised concerns within the crypto community, with some attributing it to the outflows from Grayscale’s Bitcoin Trust ETF (GBTC).
Contrary to this sentiment, analysts, including CryptoQuant founder Ki Young Ju, share a perspective aligned with Hougan’s.
Young Ju recently emphasized that Bitcoin operates in a futures-driven market, making it less susceptible to spot-selling activities from GBTC-related issues.
“BTC falls due to derivative market selling, not GBTC. OTC (over the counter) markets are very active, but no price impact,” he added.
Meanwhile, the Bitwise investment chief also clarified that the recently launched ETFs are net buyers of Bitcoin despite the outflows emanating from GBTC.
Hougan pointed out that while GBTC functions as a net seller, the cumulative BTC acquisitions from the new ETFs surpass that being offloaded by Grayscale.
Bloomberg data corroborates Hougan’s view. As of Jan. 23, GBTC’s outflows stood at $3.45 billion, while the newly introduced nine ETFs had a combined inflow of more than $4 billion in assets under management.
This data stresses a compelling narrative—that the ETFs have seen substantial interest from the community, leading to a swift and significant accumulation of the leading cryptocurrency.
Bitwise reported on Jan. 4 that surveyed financial advisors largely do not expect a spot Bitcoin exchange-traded fund (ETF) to be approved this year.
The company’s results suggest that most do not believe the U.S. Securities and Exchange Commission (SEC) will soon approve such a fund. It wrote:
“In a surprising development, only 39% of advisors [of the 437 surveyed] believe a spot bitcoin ETF will be approved in 2024. By contrast, Bloomberg ETF analysts peg the likelihood of a January approval at 90%.”
Low expectations among financial advisors appear to be due to pessimism about the approval process rather than a critical attitude to crypto, as Bitwise’s survey also found that most advisors see the approval of a spot Bitcoin ETF as a “major catalyst.” Bitwise said that 88% of advisors who are interested in purchasing Bitcoin are waiting until a spot Bitcoin ETF is approved to purchase it.
Furthermore, Bitwise found high commitment to cryptocurrency among financial advisors. It said that 98% of advisors who have an allocation to crypto in client accounts either intend to keep that exposure steady or increase exposure in 2024.
Bitwise also wrote that access is a “major barrier to adoption,” noting that only 19% of advisors are able to buy crypto in client accounts. Spot Bitcoin ETFs are expected to appeal to traditional and institutional investors and remove those barriers.
The most notable finding is financial advisors’ low approval expectations. James Seyffart, one Bloomberg ETF analyst responsible for a higher 90% prediction, called the finding “very surprising … particularly with all the added media coverage.”
Eric Balchunas, another Bloomberg ETF analyst, implied that Bitwise’s finding might be related to the age of those working as financial advisors. He suggested that “boomer advisors are not spending inordinate [amounts] of time on Twitter or even online,” where ETF optimism seems to be widespread. The idea that financial advisors skew older is supported by findings from data analytics firm J.D. Power, which indicate that the average financial advisor is 57 years old.
Bloomberg analysts’ 90% odds have gained traction outside of Bitwise’s pessimistic findings, as industry members such as Mike Novogratz and research firms like K33 Research have backed that higher prediction.
Most spot Bitcoin ETF developments have been positive, with extensive engagement from the SEC, frequent amendments from applicants in order to satisfy requirements, and applications from world-class asset managers like BlackRock and Fidelity.
One exception to this widespread optimism is a contrarian report from Matrixport on Jan. 3, which predicted that spot Bitcoin ETFs will be rejected due to SEC chair Gary Gensler’s hostility towards cryptocurrency and due to the largely Democratic politics of SEC commissioners.
Regardless of whether the SEC chooses to approve a spot Bitcoin ETF, it must decide on Ark Invest’s spot Bitcoin ETF by Jan. 10. Bitwise itself also has a spot Bitcoin ETF pending that could be potentially approved at that time.
Crypto index fund manager Bitwise Asset Management has stressed that it has no relationship with the failed technology startup Bitwise Industries, which is currently facing charges from the United States Securities and Exchange Commission.
Today we announced charges against Jake Soberal and Irma Olguin, Jr., the former co-CEOs of Fresno, California-based private technology services startup Bitwise Industries Inc., for misleading investors about the company’s finances.
— U.S. Securities and Exchange Commission (@SECGov) November 9, 2023
On Nov. 9, Irma Olguin Jr. and Jake Soberal, the founders of Bitwise Industries, were charged with conspiring to commit wire fraud and taking $100 million from various investors despite their failing business model. The SEC has alleged that the pair falsified documents to deceive investors and raise funds.
The company’s name being identical to that of the crypto fund manager has caused some confusion, with some posts on social media using Bitwise Asset Management’s logo while talking about Bitwise Industries. However, the crypto index fund manager clarified that the two are unrelated.
Related: Ethereum price hits 6-month high amid BlackRock spot ETF buzz, but where’s the retail demand?
On Nov. 10, Bitwise Asset Management insisted in a statement that it has no affiliation with the company currently facing SEC charges. It wrote:
“San Francisco-based Bitwise Asset Management, Inc., the largest crypto index fund manager in America, has no relationship with, and has never had a relationship with, the now-defunct Bitwise Industries, a former technology company based in Fresno, California.”
Bitwise Asset Management offers various crypto-related products for investment, including Ether (ETH) futures exchange-traded funds (ETFs). In addition, the company is also one of the asset managers making an effort to get approval for a spot Bitcoin ETF. On the other hand, Bitwise Industries appears to be a defunct tech firm that has not worked with digital assets in any way.
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Bankrupt crypto exchange FTX has requested the bankruptcy court in Delaware allow it to sell certain key trust fund assets, including from crypto asset manager Grayscale Investments and custody service provider Bitwise, valued at around $744 million.
In a court filing dated Nov. 3, FTX debtors requested the court to allow them to sell trust assets to enable the firm to prepare for “forthcoming dollarized distributions to creditors.”
These trust assets are held in one Bitwise trust valued at $53 million and five Grayscale trusts valued at $691 million. The trusts act as an onboarding instrument for investors to gain crypto exposure without owning the assets.
The court filing reads:
“The Debtors’ judgment is that proactively mitigating the risk of price swings will best protect the value of the Trust Assets, thereby maximizing the return to creditors and promoting an equitable distribution of funds in the Debtors’ plan of reorganization.”
The FTX debtors requested that an investment adviser should approve the sale of trust assets and sale procedures. They also proposed a pricing committee represented by the stakeholders to be part of the sale procedure.
Related: ‘Fuck regulators,’ said SBF behind closed doors: Report
The latest request by FTX debaters for the sale of trust assets comes after the court had earlier approved the liquidation of nearly $3.4 billion in crypto assets. The court ordered the sale of these assets in batches of $50 million and $100 million to avoid any market dump effects.
The FTX bankruptcy proceedings are proceeding as its former CEO, Sam Bankman-Fried, was found guilty by a jury on all seven counts during his criminal trial in New York. Bankman-Fried was found guilty of two counts of wire fraud, two counts of wire fraud conspiracy, one count of securities fraud, one count of commodities fraud conspiracy and one count of money laundering conspiracy. The judge is set to hand down sentencing in the case on March 28, 2024.
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Bitwise Asset Management announced the launch of two Ethereum-themed exchange-traded funds (ETFs), joining the growing list of asset managers looking to create Ethereum-based futures products after the SEC greenlit them.
The two funds will be called the Bitwise Ethereum Strategy ETF (AETH) and the Bitwise Bitcoin and Ether Equal Weight Strategy ETF (BTOP). Bitwise said the launch of these ETFs will facilitate investor access to Chicago Mercantile Exchange (CME) Ether futures and further expand regulated and trusted investment avenues in the crypto sector.
Bitwise chief investment officer Matt Hougan noted the extensive portfolio opportunity Ethereum offers compared to Bitcoin, describing it as a blend of alternative and conventional growth investment. He added:
“Some investors view Ethereum as an alternative, while others perceive it as a conventional growth investment, encompassing attributes of both.”
The launch comes as Ethereum continues to establish itself as a nexus of innovation and growth. It brings forth an ecosystem thriving with applications and developments, capturing the attention of millions of users and leading brands.
Bitwise CEO Hunter Horsley highlighted Ethereum’s dynamic growth and the momentum it’s gaining and said the ETFs are intended to be a gateway for investors to participate in Ethereum’s expanding landscape through regulated avenues that inspire confidence.
The commencement of trading for Bitwise’s ETFs is part of a larger trend, with numerous companies, including Invesco and Valkyrie, exploring Ethereum ETF offerings while awaiting approval for spot Bitcoin ETFs.
The decisions by the U.S. SEC on these applications are highly anticipated, with outcomes potentially being influenced by related developments such as the Grayscale lawsuit.
The crypto community is keenly observing what the SEC does, as approval decisions by the watchdog are poised to shape the trajectory of crypto investments in the U.S. for years to come.
Notably, Bloomberg analyst James Seyffart revealed that nine Ethereum Futures ETFs, including Bitwise’s, are set to receive expedited approval from the SEC for their launch on Monday, October 2, 2023.
The post Bitwise joins growing list of Ethereum ETF managers appeared first on CryptoSlate.
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