The End of a Long Wait: SEC Expected to Approve Spot Bitcoin ETFs on Wednesday
After more than a decade of denials, it seems like the Securities and Exchange Commission (SEC) may finally approve spot bitcoin ETFs. According to Valkyrie co-founder and CIO Steven McClurg, the potential for $10 billion or more to enter spot bitcoin ETFs by the end of 2021 is a realistic expectation. He further predicts that this figure could reach $20 billion when accounting for potential market movement.
McClurg also believes that by 2024, bitcoin’s price could reach $150,000 or even higher. “As far as price, I think there will be a supply shock that moves [the] price forward,” he explained. “The ETF creates a lack of supply, so buying activity. After the halving, I expect us to go back into a bull cycle and from a macroeconomic perspective I do think the Fed is going to lower rates again in May/June ahead of the election which will cause risk excess to go up.”
Along with Valkyrie, there are 11 other applicants for a U.S. spot bitcoin ETF, including major firms like BlackRock, Grayscale, and Fidelity.
We had a chance to sit down with McClurg and discuss the impending demand for spot bitcoin ETFs, his thoughts on the potential decline of futures bitcoin ETFs, the possibility of other spot crypto ETFs, and the ongoing “fee wars.” The following interview has been edited for length and clarity.
Q: When did you first have an inkling that the SEC might approve a spot bitcoin ETF?
A: We’ve been preparing for this for about six weeks now and it’s been a whirlwind. But it wasn’t until the end of September, beginning of October, around the time we were launching our ETH futures ETF, that we received comments from the SEC on our spot bitcoin application. We were surprised, but also excited because we knew the approval process was finally moving forward.
We are confident that the SEC will approve the spot bitcoin ETF on Wednesday, with trading set to begin on Thursday.
Q: How did your ETH futures ETF launch go in September?
A: We actually took a different approach. When we realized that the spot bitcoin ETF may be approved soon, we converted our bitcoin futures ETF into a product that could invest in both ETH and bitcoin. This allows us to actively manage the market on these two assets, which is easier to do in the futures market. And if an ETH spot becomes available, we could easily launch a bitcoin ETF as well.