Window To Front-Run Institutional Demand For Bitcoin Is Closing: Michael Saylor

Updated: 22 June 2023

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Major Firms Join the Race for Bitcoin ETF Approval

Last week, BlackRock, the world’s largest asset manager, filed an application for a Bitcoin ETF with the US Security Exchange Commission (SEC). The firm has partnered with Coinbase, and the ETF would use the exchange’s spot market data for pricing as well as Coinbase Custody for the ETF. The ETF would also use BNY Mellon as the cash custodian.

This week, four other firms, Fidelity, Invesco, Wisdom Tree, and Valkyrie, followed BlackRock’s lead and made their application for similar ETF platforms. According to analysts, this has resulted in an increase in BTC’s price by 19% to $30,240.

The goal of Bitcoin ETFs, which track the price of the most popular cryptocurrency, is to give investors access to changes in the price of Bitcoin without needing them to actually hold and store the underlying asset.

As such, investors can acquire shares of the ETF, which reflects ownership of a pool of Bitcoin owned by the fund, rather than buying and holding their own Bitcoin.

However, to facilitate this, the institutions will need to hold Bitcoin or have shares in companies that hold Bitcoin. This is expected to result in an increase in the BTC price as demand for the asset rises.

The Great Accumulation of Bitcoin

The co-founder of Gemini, Cameron Winklevoss, said: “The Great Accumulation of Bitcoin has begun.” According to Winklevoss, purchasing Bitcoin now would be similar to buying a company’s shares pre-IPO. He states that once the ETFs go live, the asset’s prices are bound to increase significantly.

“Anyone watching the flurry of ETF filings understands the window to purchase pre-IPO bitcoin before ETFs go live and open the floodgates is closing fast. If Bitcoin was the most obvious and best investment of the previous decade, this will likely be the most obvious and best trade of this decade” he tweeted.

Not only that #Bitcoin has a max cap of 21 mio. It also gets more and more illiquid on the buyer site.
-> Nobody wants to sell.

With spot ETFs, institutional money and all the FOMO boys coming in during the next months/years the price will mostlikely explode to the upside. pic.twitter.com/IpKGkjtvMC

— Robin Seyr (@RobinSeyr) June 22, 2023

A similar sentiment was shared by Michael Saylor, MicroStrategy’s Executive Chairman, who tweeted: “The window to front-run institutional demand for Bitcoin is closing.” The tweet which was referencing an EDX Market post implied that growing institutional demand may soon overshadow the participation of retail investors in the BTC market.

Scramble for Bitcoin ETF is Just Starting

Another analyst and Bitcoin investor, Anthony Pompliano, stated that the Bitcoin market is about to get intense. He tweeted saying that the entrance of institutions into the market once the ETFs are approved will likely cause a surge in the asset’s price, considering how much increase has been witnessed in just a week.

BlackRock shows up and bitcoin is up 20% for the week.

People forget that bitcoin went from $0 to nearly $1 trillion market cap with almost no institutional participation.

If retail investors were good for $1T, what do you think happens when the deep pockets come play?

— Pomp 🌪 (@APompliano) June 21, 2023

In an interview with CNBC, Pompliano explained that “We have institutions and individuals scrambling to try to get their share of the 21 million Bitcoin that will ever be in existence.” He added that expected BTC to become “highly illiquid” as retail investors, who currently own most of the BTC on the market, would not want to sell to institutions.

What remains to be seen is the effect ETFs will have on the crypto market once they are approved by the SEC. The Commission has been very vigilant concerning the industry hence it would be naive to expect that the applications will be accepted any time soon.

Bitcoin price has been extremely bullish since last week, when Blackrock filed for a Bitcoin spot ETF . The largest cryptocurrency continued with its aggressive climb on Wednesday and during the Asian session on Thursday.

The Window To Front-Run Institutional Demand For Bitcoin Is Closing – Says MicroStrategy’s Michael Saylor — BTC/USD daily chart | Tradingview

Although Bitcoin almost breached the highs reached in the April, slightly above $31,000, it had corrected below $30,000 at the time of writing. Support is expected at $29,000, but if push comes to shove and BTC loses the next anchor at $28,000, investors may start acclimating to declines to $25,000.