Coinbase country head for Singapore Hassan Ahmed believes the approval of a spot Bitcoin exchange-traded funds (ETF) will be the catalyst for a “structural market change” for the flagship digital asset.
Ahmed made the statement during an appearance on CNBC International on Jan. 2. He said:
“[The ETFs] are as big a deal as people are making it out to be.”
Ahmed added that the ETF hype is more than a mere trend and will create a regulated path for trillions of dollars to come into the industry that has so far been “locked out of the asset class.”
SEC making way for ETF
Ahmed said that the SEC is currently making way for the ETFs, which have been in the works for more than a decade now. He said it is likely that the SEC will give the industry an update by the Jan. 10 deadline.
According to the Coinbase exec, the SEC is unlikely to reject the spot ETFs as its “hand has been forced” by approving the futures Bitcoin ETF in the past. Since the two are similar structurally, the regulator does not have a good reason to continue rejecting them.
He added that the regulator’s recent actions point to a positive outcome; however, nothing is a “done deal.”
Ahmed said that once these ETFs are approved, it will further “destigmatize and legitimize” Bitcoin for institutional investors like wealth managers and asset managers in the U.S. who have been waiting on the sidelines for years now.
The ETFs will almost certainly lead to increased demand for the flagship cryptocurrency.
Explosive growth factors
Ahmed pointed out two key catalysts for Bitcoin in 2024: an increase in demand and a reduction in supply due to the upcoming halving event. He posited that these factors could lead to explosive growth for Bitcoin.
Ahmed added that the demand for Bitcoin block space is rising on the back of Ordinals and Inscriptions, which has led to BTC transaction fees hitting a “relative high since 2020.”
According to the Coinbase executive, this trend will lead to additional miner revenue and network security in the long term.
The potential approval of this ETF is seen as a pivotal moment in the cryptocurrency sector, indicating a growing acceptance and institutional interest in digital assets. This development, Ahmed suggests, could provide a compliant and familiar channel for asset managers and allocators to engage with the asset class.
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