The U.S. Securities and Exchange Commission’s (SEC) approval of a bitcoin exchange-traded fund (ETF) is likely to trigger a buying rally, according to an executive at advisory and consulting firm EY.
The comments come as the SEC is expected to decide on the VanEck Bitcoin ETF in the next few months.
Chris Powers, an EY partner for digital assets markets, suggested that an approved charity ETF would likely cause a buying rally.
“In the event that, I think you start to probably see, depending on what the actual structure is around this product, some more frenetic buying activity, potentially even a buying rally of sorts,” Powers stated in a recent statement.
Powers noted that the buying activity would likely come from institutional investors, as retail investors have been present in the crypto space for some time. He went on to explain that it is institutions that have been able to maneuver the complex crypto investment landscape, rather than retail investors being limited in their maneuverability.
“We’re seeing those institutions, starting to getting more comfortable with the space, starting to do the research, starting to build out their business processes and custodial and risk management controls.”
If approved an ETF could lead to the legitimization of bitcoin and other crypto assets within traditional finanical markets. This forthcoming decision is likely cause excitement within the crypto community. Along with the resulting buying rally, investors should remain aware that such events are often fuelled by speculation and remain vigilant with any investments in the space.