The wave of change in the global financial landscape, ushered in by the approval of Bitcoin exchange-traded funds (ETFs) a year ago, continues to ripple. These instruments made a sensational entry into the United States, marking one of the most robust ETF debuts in the nation’s financial market. The crypto market also experienced a simultaneous seismic shift. As we enter the second year of their existence, Bitcoin ETFs and their trajectory are a hot topic for discourse. Nate Geraci, the esteemed President of the ETF Store, adds his voice to the crypto ETF outlook for 2025, foretelling marquee developments.
Rising Above Gold: Bitcoin ETFs in the Ascendant
On 11th January, Geraci took to an influential social media platform to share his forecast for the crypto ETF segment for this year. The ETF Store President believes that Bitcoin ETFs, which have already completed a year, are poised to carry forward their momentum from 2024.
Geraci makes a compelling prediction, that the US-based Bitcoin ETF market will overtake the net assets of physical gold ETFs, barring any drastic plummet in Bitcoin’s value. At present, the spot Bitcoin ETFs contain total net assets amounting to $107.64 billion, dwarfing the $271 billion held by gold-backed ETFs.
The ETF Store President further anticipates the approval of options trading on spot Ether ETFs by the United States Securities and Exchange Commission (SEC). He also hints at the possibility of the SEC sanctioning Ether exchange-traded fund staking in 2025.
ETFs Break New Ground
As per Geraci’s insights, the creation and redemption mechanism used during the spot Bitcoin ETFs application was a key point of contention. However, he predicts that investors should be able to make exchanges using actual Bitcoin or Ether to create or redeem their ETF shares by year-end.
Another bold prediction from Geraci implies that the Bitwise Bitcoin Standard Corporations ETF, focusing on companies adopting the ‘Bitcoin Standard’, will make its debut and amass over $1 billion in assets before 2025 concludes. He also foresees the launch of at least 50 other crypto-related ETFs this year.
In addition, Geraci envisages the SEC approving spot Solana and XRP ETFs alongside Bitwise and Grayscale Crypto Index ETFs in 2025. In a critical development, he expects Vanguard, a leading investment advisor, to enable brokerage access to spot Bitcoin and Ether ETFs for its clients.
Snapshot of the Cryptocurrency Landscape
As per CoinGecko’s data, the total crypto market capitalization currently hovers around $3.46 trillion, signifying a slight dip of over 1% in the past day. Bitcoin retains its dominant position with a staggering market cap of $1.87 trillion, leaving Ethereum trailing behind with a market cap of $495 billion.
FAQs
What is a Bitcoin ETF?
A Bitcoin ETF is an investment instrument that tracks the price of Bitcoin, allowing investors to participate in Bitcoin trading without owning the cryptocurrency directly.
How does a Bitcoin ETF work?
Bitcoin ETFs work similarly to traditional ETFs but focus on Bitcoin as the primary asset. This instrument allows the buying and selling of Bitcoin shares on traditional exchange platforms.
What are the benefits of Bitcoin ETFs?
Bitcoin ETFs offer several benefits including increased liquidity, regulated investment environment, and exposure to Bitcoin without the complexities of direct ownership and storage.
What is the future outlook for Bitcoin ETFs?
Bitcoin ETFs are expected to maintain an upward trend, with the potential to surpass gold ETFs. There is also an anticipation of more crypto-related ETFs launching, which indicates a positive future outlook for Bitcoin ETFs.
