contributor
Posted:
- Galaxy’s Alex Thorn underlined that the $14 million prediction for Bitcoin ETFs was a “conservative estimate.”
- In contrast, JP Morgan warned against too much optimism around the crypto rally.
“During the bear market between 2013 and 2017 it was like ‘Bitcoin is for criminals’, now the world’s largest asset manager says it’s part of a ‘flight to quality’ trade; it is truly remarkable.”
This sentiment was well expressed by Alex Thorn, Head of Firmwide Research at Galaxy made these comments during a conversation with Peter McCormack on his podcast, “What Bitcoin Did.”
Regarding the recent bull run, the head of Galaxy Research said expectations are round Bitcoin [BTC] exchange traded funds (ETFs) should also apply to the grayscale pronunciation in August.
Thorn also emphasized that the Securities and Exchange Commission (SEC) was reluctant to comment on the S1 process. As applicants have submitted changes to their S1 filings, anticipation has grown around ETF approval.
However, the SEC’s concerns about these amendments were “benign.” This included additional disclosures about risks, a lack of corporate governance behind open source software and the risks of illegal activities.
None of these concerns were particularly serious. So it’s hard to understand why the SEC didn’t comment on it sooner.
Yet it is a positive development.
Thorn viewed the SEC’s changing behavior toward cryptocurrencies as reflecting a position shared previously by Cathie Wood, CEO of ARK Invest. She had also said that the agency would approve multiple spot Bitcoin ETF applications at once.
There is a general understanding in the market that this is indeed true of the SEC.
JP Morgan warns against over-enthusiasm
JP Morgan analysts issued a report last week claiming that the “crypto rally appears overblown.” The analysts have listed their reasons for the findings.
First, capital can only shift from existing Bitcoin products like the futures ETFs and public Bitcoin mining companies to spot ETFs. Additionally, existing spot Bitcoin ETFs in Canada and Europe have received little investor interest since their launch.
Second, the recent legal victories for Grayscale and Ripple [XRP] will not necessarily translate into the relaxation of crypto regulations in the US
Third, investors likely overestimated the optimism surrounding Bitcoin’s halving.
The post-union industrialization of TradFi and DeFi violates the underlying principles of cryptocurrency, such as decentralization and trustlessness. But it could lead to broader participation in crypto and possibly a bull run, Thorn said. He added,
“It is entirely reasonable for Bitcoiners to be suspicious of Bitcoin’s industrialization.”