VanEck predicts $2,4 billion in inflows into BTC ETFs after their approval in early 2024

According to analysts, the product will quickly enter the mainstream thanks to zero commissions

08.12.2023 - 13:22

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What’s new? In early 2024, the United States will enter a recession, indicated by slowing economic growth and lower inflation, and with it, spot crypto exchange-traded funds (ETFs) will be approved, analysts at investment firm VanEck say in a new report. They believe that despite the worsening economic situation, such funds will be able to raise $2,4 billion in the first quarter after launch alone. In addition, the expected lower transaction costs of these ETFs compared to current retail fees will ensure wider adoption of the new type of investment product.

VanEck’s report

What else is known? To make the prediction, analysts took the historical performance of the SPDR Gold Shares (GLD) gold fund, launched in 2004 and captured significant market share during the quarter, and applied that performance to bitcoin, adjusted for higher M2 (money supply in circulation and bank deposits).

Using this method, VanEck analysts concluded that over two years, spot BTC ETFs could raise $40,4 billion. The inflow of funds will be provided, among other things, by the growing popularity of bitcoin as a means of hedging inflation, an alternative to gold.

In addition, experts believe that ETF shares will be traded without commissions, which will also contribute to the adoption of the product. For comparison, on the US exchange Coinbase, the commission for retail traders is currently 2,5%.