Tether CEO Predicts Fund Manager Rush to Bitcoin Post-ETF Approval

Recently, during a panel, Paolo Ardoino, the Chief Executive Officer of Tether, shared his ideas about what role Bitcoin would play in traditional finance. Ardoino’s predictions are based on the U.S. SEC’s approval of the first spot Bitcoin exchange-traded funds (ETFs). This decision has pushed this cryptocurrency, making it more acceptable among seasoned investors.

Increased Interest from Institutional Investors

Ardoino expects that fund managers will be the next group to realize the potential of Bitcoin by incorporating it into their investment portfolios. These expectations of private investors are founded on the approval of spot Bitcoin ETFs in the US. These ETFs not only extended the accessibility of Bitcoin in traditional investment markets but also gave it legitimacy through the stamp of authority. 

.@PaoloArdoino on the total addressable market of securitized tokens on the bitcoin network: "…in the trillions." https://t.co/OtcaV2nEsl

— Tuur Demeester (@TuurDemeester) February 27, 2024

In the context of Ardoino, fund managers could allocate around five percent of their assets toward Bitcoin. This shift indicates a broader trend of digital assets becoming integral to diversified investment strategies.

Bitcoin on Corporate Balance Sheets

Placing Bitcoin in the corporate world on balance sheets is a realistic step many companies have done, as the Tether CEO noted. The spot Bitcoin ETFs have come to the market against a backdrop when only a handful of companies, such as Tesla, Inc., and MicroStrategy Inc., had publicly declared their Bitcoin positions. 

Ardoino hopes that the introduction of spot bitcoin ETFs will create a tendency for more companies to follow suit, especially during political instability, but use Bitcoin to protect their assets against the volatility of the traditional financial markets.

Surge in Bitcoin ETF Assets

Following the green light given to the first spot Bitcoin ETFs, the assets under management of these funds have expanded markedly, now reaching around $42 billion. These numerous bitcoin EFTs are a reason behind the capital flow to the cryptocurrency, which consequently saw a price rally, breaking an all-time high of $56,000 since November 2021. This move in the price is a clear indicator that the heavy institutional investment has a considerable effect on Bitcoin’s market dynamics.

Ardoini also discussed that regulation reshaping around cryptocurrency is changing. As the issue magnifies with other countries like El Salvador adopting BTC as their legal tender, he postulates that regulators and policymakers in the other jurisdictions must evolve to keep up with the fast-changing financial environment. 

The United States is witnessing bills introduced that will give slots to implement regulatory frameworks for cryptocurrency, including stablecoins. In addition, SEC Chair Gary Gensler’s categorization of Bitcoin as a commodity has put it in a different class than other crypto-currencies commonly treated as securities.

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