Get ready crypto investors! Here’s what a BlackRock Bitcoin ETF would mean.

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Source: shutterstock.com/Unknownman

As InvestorPlace reported yesterday, there is a key development in the crypto world that is upsetting expectations. Bitcoin (BTC) investors seem intrigued by the potential of a new exchange-traded fund (ETF) BlackRock (NYSE:BLK). Given BlackRock’s status as an innovative force in the ETF world (and a trusted partner of many institutional investors), this rollout could prove to be a big deal for the entire industry.

This is largely because where the price of BTC goes, most other cryptos follow. The first indicator of this sector, Bitcoin remains the focal point for most investors looking at the world of digital assets. In fact, for institutional investors, BTC is among the few asset classes that can be held, given the ongoing regulatory overrun that this space is facing. So far, Bitcoin has not been designated as a security, freeing investors from potential headaches down the road.

Bitcoin’s outperformance this year, relative to many of its peers, has been noticeable. As a result, now may be the time for fund managers to get back into the game.

Let’s dive into what a BlackRock Bitcoin ETF would mean for investors in the future.

Could a BlackRock Bitcoin ETF be what this sector needs to rally?

Interestingly, many experts in the crypto world seem to think that a BlackRock Bitcoin ETF is exactly what the doctor ordered for the crypto industry. Some have gone so far as to suggest that such an ETF could spur a “potential $15 trillion crypto boom.” It is a title that will certainly attract the attention of investors.

I’m not sure such a boom could be around the corner. After all, inflation remains stubbornly high, as do interest rates. In such an environment, it is difficult to predict that such an ultra-bullish thesis will come to fruition.

That said, I will concede that a Bitcoin ETF focused on institutional investors could spur significant capital inflows into the sector. Depositing a spot ETF (rather than the currently available ETFs, which are linked to futures contracts) could have a large impact on the daily price movements for BTC. So, for those holding out for dear life, such an ETF could stimulate the kind of positive buying pressure that leads to another 2021-style rally. Or at least that’s the hope.

We will see if regulators approve such an ETF, given that similar funds have not been approved in the past. If BlackRock’s ETF is approved, the company’s massive market share in the money management world could create a unique set of circumstances for Bitcoin and this asset class. Personally, I’m on the edge of my seat with this one.

As of the date of publication, Chris MacDonald did not hold (either directly or indirectly) any position in the securities mentioned in this article. The opinions expressed in this article are those of the author, subject to InvestorPlace.com publishing guidelines.

Chris MacDonald’s love of investing has led him to pursue an MBA in finance and take on a number of management roles in corporate finance and venture capital over the past 15 years. . His experience as a financial analyst in the past, coupled with his fervor for finding undervalued growth opportunities, contribute to his conservative long-term investment outlook.

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