Ark Invest CEO Cathie Wood expects spot bitcoin exchange-traded funds (ETFs) to move the price of bitcoin “much higher.” The securities regulator is expected to make a decision on spot bitcoin ETFs by Wednesday. “We think that the SEC approval, should we and others get it, is a green light for institutions. We’ve been talking to quite a few of them, and they’re much more interested now that the SEC effectively is paving the way,” the executive shared.
Cathie Wood on Potential Spot Bitcoin ETF Approvals
The CEO of Ark Investment Management, Cathie Wood, shared her view on the potential spot bitcoin exchange-traded fund (ETF) approvals by the U.S. Securities and Exchange Commission (SEC) in an interview with CNBC Monday. Her firm’s joint proposal with 21shares is up for a decision on Wednesday, the first deadline for spot bitcoin ETF applications this year.
Regarding whether institutional investors are more open to investing in bitcoin with the expected approval of spot bitcoin ETFs, the Ark executive said:
We think that the SEC approval, should we and others get it, is a green light for institutions. We’ve been talking to quite a few of them, and they’re much more interested now that the SEC effectively is paving the way.
When asked about whether her firm’s spot bitcoin ETF proposal will be approved by the SEC, she replied: “We do think the probability is very high that the bitcoin ETF will be approved this week, and the reason, as we’ve been saying, is the SEC actually, after denying, denying a number of times, started asking questions — very good questions, very detailed questions, very technical questions — So, I think they’ve asked all the questions they need answered, and I think most of us have probably been a part of that process.”
Wood also believes that spot bitcoin ETF approvals might not be a sell-the-news event some have predicted. “I think so many people are expecting a ‘sell on the news’ that we might not have,” she said, emphasizing: “Once you hear that enough, their positionings are already taking place. Who knows, it’s a very short-term.” The Ark Invest CEO continued:
All we know is with our five-year investment time horizon, we think the flows into this new asset class, especially institutional flows … are going to be quite substantial, and it won’t take much of an allocation by institutions into bitcoin to drive what’s becoming a scarce asset much higher.
The Ark Invest CEO proceeded to detail why she thinks the price of bitcoin will “continue to move higher.” Firstly, she explained that bitcoin is digital gold, noting that gold is a $12 trillion asset. “I think bitcoin might be up to $800 billion right now. So we do think there is some substitution taking place,” she explained.
“And the institutional flows, if the allocations were as little as 2.5% to 5%, which is where we think they will end up,” she added. “You’ll see 0.5% and then 1%. You’ll see a legging in that could be the biggest reason for a bitcoin to go up.” Wood concluded:
Because, you know, we’re at 19.5 million bitcoin outstanding already. 15 million roughly are in long-term hands. They haven’t moved their bitcoin in more than 155 days. And we know we’re only going to 21 million units ever. So this indeed … is becoming a scarce asset.
Do you agree with Ark Invest CEO Cathie Wood about the impact of spot bitcoin ETFs? Let us know in the comments section below.