Galaxy Digital CEO believes Bitcoin (BTC) will finish the year on a high following a string of positives.

He notes that approving a Bitcoin ETF will be instrumental in pushing the asset class to new highs.

The U.S. SEC currently stands in staunch opposition to a spot ETF, but a wave of applications could see it lower its guard.

Galaxy Digital CEO Mike Novogratz opines that if the Securities and Exchange Commission (SEC) gives the green light for a spot BTC exchange-traded fund (ETF), it will turn around the fortunes of the largest virtual currency.

Novogratz disclosed in an interview with BloombergTV, noting that the SEC’s thumbs up for ETFs may be construed as a “seal of approval” for the asset class. He noted that a spike in the number of ETF applications in recent months has contributed to BTC’s meteoric rise in 2023.

BlackRock, Ark Invest, and WisdomTree have all submitted their applications for a spot Bitcoin ETFs, braving multiple rejections from the SEC.

“What I do think is BlackRock, Invesco, and the group of ETF providers is a real signal that adoption is coming,” said Novogratz.

He pointed out that after over a decade since the first ETF application, the industry has garnered enough infrastructure to support the operations of ETFs. Novogratz added that akin to the approval of a futures ETF in 2021, the SEC may approve several firms at a go, given the similarities of their applications.

“The SEC is not going to approve one, so you’re going to have these giant sales forces out there giving access to people that didn’t have access before,” Novogratz said.

He notes that the approval will send Bitcoin’s value soaring as new investors interact with the ETFs. In the weeks following the approval of a BTC futures ETF, the asset reached its all-time high of $69,789.

However, Novogratz expressed scepticism over the SEC granting approvals before the end of the year, noting its hard stance toward cryptocurrencies.

The SEC’s argument against spot ETFs

The SEC has pointed out that spot BTC ETFs do not offer enough protections for individual investors, claiming that “the underlying spot market of bitcoin is subject to fraud and manipulation.” 

After the SEC rejected a batch of applications in June, it noted that the sections on a surveillance-sharing agreement with a trading platform were inadequate. Including the surveillance-sharing agreement has been described as the answer to the SEC’s concerns about price manipulation.

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Filed under: Bitcoin - @ July 13, 2023 8:13 pm