According to a blockchain executive at professional services provider Ernst & Young (EY), Bitcoin (BTC) is in high demand from institutional investors but needs a spot BTC exchange-traded fund (ETF) approval to spark a buying rally.
Because US regulators have not approved a spot Bitcoin ETF for years, EY's global blockchain leader Paul Brody believes Bitcoin ETFs face a lot of pent-up demand from institutions.
On CNBC's Crypto Decrypted on October 23, Brody discussed the outlook for cryptocurrency adoption, claiming that trillions of dollars in institutional money are waiting to enter Bitcoin once a BTC ETF is approved.
“But any of these other institutional funds, they can’t touch this stuff unless it’s an ETF or some other kind of regulatory blessed activity,” EY’s blockchain expert stated.
He further added:
“If you look at people who are buying Bitcoin, they are buying it as an asset. They are not buying it as a payment tool. Those who are buying Ethereum, are buying it as a computing platform for business transactions and DeFi [decentralized finance] services.”
Brody's comments come as global investors closely monitor the Securities and Exchange Commission's (SEC) crypto regulatory process, which has yet to approve a single spot Bitcoin ETF.
Grayscale Investments, ARK Investment, BlackRock, and Fidelity are among the firms that have filed with the SEC for multiple Bitcoin ETF products and are awaiting a regulatory response.
Grayscale, which won an SEC lawsuit for a spot Bitcoin ETF review in August 2023, has just filed an S-3 form registration statement with the SEC in order to list its Grayscale Bitcoin Trust on the New York Stock Exchange Arca.
According to Bloomberg senior ETF analyst Eric Balchunas, ARK Invest and 21Shares' recent amendment to the spot Bitcoin ETF is a "good sign" of progress and impending approvals.
The ETF expert believes that the ETF amendments filed in mid-October 2023 may be in direct response to concerns raised by the SEC.