Bitcoin Heads to Wall Street. Now What?

Thanks to newly approved financial products, investors can soon trade Bitcoin on markets like the New York Stock Exchange.Credit…Hiroko Masuike/The New York Times

Bitcoin bulls join forces with Wall Street

A new era of crypto trading is expected to begin as soon as today, after the S.E.C. finally approved the creation of new exchange-traded funds that would allow investors to more easily buy and sell Bitcoin.

The regulator yesterday authorized 11 fund managers — including the Wall Street fund giants BlackRock and VanEck and smaller companies like GrayScale and Valkyrie — to begin offering the new crypto investment products.

In anticipation of the decision, the companies have been aggressively cutting their management fees to gain an early advantage. “The fundamental change is a whole lot more money is coming into this asset class,” Paul Grewal, the chief legal counsel of the crypto exchange Coinbase, told DealBook. Matthew Sigel, the head of digital asset research at VanEck, called it a “historic” moment.

Bitcoin hit a 21-month high this week, as crypto boosters shrugged off a series of high-profile bankruptcies and a sweeping legal crackdown against some of the biggest players in the sector. That said, the cryptocurrency’s price barely budged this morning, trading below $47,000, giving the digital token a market value of roughly $920 billion.

How big could the market get? Unsurprisingly, crypto buyers and those offering the Bitcoin E.T.F.s think the potential is limitless. Grewal said investors could pour billions of dollars into digital asset markets in the short term, and trillions over time.

But even some outside the sector see reason for growth. “We anticipate further prices increases in the current year,” the Deutsche Bank researchers Marion Laboure and Cassidy Ainsworth-Grace wrote a note to investors today. They added that a flood of institutional investors and expected new crypto-trading regulation, including in the European Union, could bolster the market for digital assets.

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