Bitcoin Could Hit $42K if BlackRock Bitcoin ETF is Approved: Matrixport
Crypto financial services platform Matrixport has predicted a major Bitcoin (BTC) rally driven by favorable macroeconomic conditions and lower US inflation.
In a recent report titled "Matrix onTarget," the company noted that one notable development is the remarkable performance of Grayscale Investments' Bitcoin Trust (GBTC) shares, which have surged by an impressive 167% year-to-date, outperforming Bitcoin's own 71% growth.
At the beginning of the year, GBTC's net-asset-value (NAV) discount stood at -45% and slightly narrowed to -43%.
However, the real game-changer came with BlackRock's announcement of its Bitcoin ETF application on June 15, 2023.
In an earlier report, Matrixport revealed that the US registered investor advisor (RIA) community consists of approximately 15,000 advisors overseeing around $5 trillion.
"This group holds immense potential, and even a modest 1% allocation recommendation for Bitcoin would usher in around $50 billion in inflows," the company wrote.
Comparing this to the precious metals ETFs, which have a market cap of around $120 billion, assuming that 10-20% of precious metal ETF investors consider diversifying into a Bitcoin ETF as a hedge against monetary debasement and inflation, Matrixport said we could witness an inflow of $12 to $24 billion into the Bitcoin ETF.
"If Tether’s market cap increases by $24 billion, acting as a proxy for potential ETF inflows, Bitcoin’s price would rise to $42,000, representing a conservative estimate."
Moreover, with a larger influx of $50 billion resulting from a 1% allocation recommendation by RIAs, Bitcoin has the potential to rally up to $56,000, the firm added.
Matrixport's projections come amid growing optimism toward the launch of a spot Bitcoin ETF.
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