- Matrixport releases research note highlighting the potential implications of recent developments in the crypto industry on the approval of a spot Bitcoin Exchange-Traded Fund (ETF) in the United States.
- The guilty plea of Binance CEO Changpeng Zhao (CZ) and increased regulatory actions suggest a shift towards regulatory alignment with traditional finance systems, potentially facilitating the approval of a spot Bitcoin ETF in the US.
Matrixport, a leading digital finance platform, has published a comprehensive research note shedding light on the significant implications of recent events within the crypto industry, particularly in relation to the prospects of a spot Bitcoin Exchange-Traded Fund (ETF) gaining approval in the United States.
Regulatory Clarity Emerging
Following the recent guilty plea of Binance CEO Changpeng Zhao (CZ) and the substantial financial settlements involved, Matrixport suggests that the path for approving a spot Bitcoin ETF in the US may have become considerably clearer. This development is indicative of the regulatory crackdowns and compliance upgrades occurring in the crypto sector, signalling a shift towards greater regulatory alignment with traditional financial systems.
Matrixport remarks, “Some would argue that the US agencies have cleaned up the industry this year by dismantling the US crypto-related banks, as two of them were running an internal ledger that crypto companies could use 24/7 to transfer fiat. Arguably, few (perceived) major actors are left, and with Bitcoin only declining -3.4% during the last 24 hours, the market is stomaching a major risk-off event.”
Key Metric for 2024
The company points out that as stringent enforcement actions and enhanced compliance programs become the norm among crypto exchanges, the differentiation between regulated and non-regulated exchanges may become a pivotal metric in 2024. This shift is seen as instrumental in the potential approval of a spot Bitcoin ETF in the US, a development long-awaited by the industry.
Institutional Adoption and Safe-Haven Status
Matrixport believes that this industry “whitewashing” will not only enhance Bitcoin’s adoption by institutional players but also position it as a safe-haven asset in investment portfolios. The note predicts, “More importantly, this industry’s whitewashing will strengthen the Bitcoin adoption case for institutional players and will likely become a safe-haven asset in investors’ portfolios.”
Further Developments on the Horizon
Matrixport also speculates about the potential sale of the FTX exchange and its relaunch under US securities law-compliant management by Q3 2024. This move could result in significant inflows, estimated between $24-50 billion, into any US-listed Bitcoin ETF. Additionally, the trend of crypto firms participating in CME-listed crypto derivatives markets suggests a shift towards fully regulated exchanges catering to institutional clients.
Recent movements in the spot ETF approval process include Ark Invest initiating the third round of amendments to the S-1 filings, and Grayscale holding a meeting with the US Securities and Exchange Commission regarding its “uplisting.”
At the time of writing, BTC is trading at $36,483.
