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Bitcoin ETF Impact Might be Modest Initially but Massive in the Long Run

Key Takeaways

VanEck advisor Gabor Gurbacs believes that while the immediate impact of a Bitcoin spot ETF approval may be overestimated, its long-term effect could be substantial.

Modest Initial Inflows

Gurbacs suggests that only about $100 million, mostly recycled from institutions, might initially flow into the market after a Bitcoin spot ETF receives SEC approval.

Parallels with Gold’s History

Long-term projections draw parallels with the history of gold; the market capitalization of gold surged from $2 trillion to $10 trillion after ETF introduction. Comparatively, Bitcoin’s market cap is around $750 billion, and Gurbacs implies that trillions could enter the market in the coming years.

He mentioned that a few $10 billion might come from Bitcoin ETP adoption but emphasized the significance of Bitcoin’s “relatively low float” and “systematic scarcity via halving schedules.”

Focus on the Long Run

Gurbacs noted that there’s excessive hype around short-term growth prospects, overshadowing the broader possibilities. He also mentioned the potential impact of state sovereign funds and institutional investors, drawing from parallels with gold’s past performance.

Renewed Enthusiasm

The crypto market has seen renewed enthusiasm due to speculation around spot BTC ETF approval, with Bitcoin investment products garnering $1.6 billion in inflows and AUM rising to over $36 billion last year. Several analysts have speculated that an ETF approval could usher trillions into the market, significantly influencing Bitcoin’s price.

[wrote on X (formerly Twitter)](https://x.com/gaborgurbacs/status/1741463685275476023?s=46&t=sCvh3f3rMDfXyJcf1y1Eyg)

[December 31, 2023](https://twitter.com/gaborgurbacs/status/1741463685275476023?ref_src=twsrc%5Etfw)

[Gurback’s view](https://x.com/gaborgurbacs/status/1732416029446320590?s=46&t=sCvh3f3rMDfXyJcf1y1Eyg)



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