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Coinmarketcap
October 25, 2023
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The price of Bitcoin (BTC) will rise by 74.1% in the first year after the launch of Bitcoin exchange-traded funds (ETFs) in the United States, according to estimates from cryptocurrency investment firm Galaxy Digital.

In an October 24 post, Galaxy Digital research fellow Charles Yu estimated that the total addressable market size for Bitcoin ETFs would be $14.4 trillion in the first year after launch. He obtained the 74% figure by evaluating the potential price impact of fund flows into Bitcoin ETF products using gold ETFs as a baseline.

According to Yu’s estimates, Bitcoin’s price will rise 6.2% in the first month after the ETF’s launch before steadily trending downward to a 3.7% monthly increase by the 12th month.

The Spot Bitcoin ETF estimates one-year monthly inflows and the impact of Bitcoin’s price. Source: Galaxy Digital Research

Yu used Bitcoin price data as of September 30, but a 74.1% increase in the current Bitcoin price would take it to $59,200.

Markus Thelen, head of research at digital asset financial services firm Matrixport, arrived at a similar number in an October 19 post, estimating that the price of Bitcoin could rise to between $42,000 and $56,000 if a Bitcoin ETF application is approved. On the stock exchange of BlackRock.

Yu expects the addressable market size for US Bitcoin ETFs to reach $26.5 trillion in the second year after launch and $39.6 trillion after the third year.

Bitcoin ETF market size and inflow estimates over the first three years. Source: Galaxy Digital Research

Related: BlackRock’s Bitcoin ETF: How it works, benefits and opportunities

Yu admitted that delaying or rejecting spot Bitcoin ETFs will affect price expectations.

However, he said the estimates were still conservative and did not take into account “second-order effects” resulting from the immediate approval of a Bitcoin exchange-traded fund.

“In the near term, we expect other global/international markets to follow the US lead in agreeing to + offering similar offerings of Bitcoin ETFs to a greater number of investors,” Yu wrote.

“2024 could be a big year for Bitcoin,” he added, citing ETF inflows, the April 2024 halving of Bitcoin’s price, and “the possibility that prices have peaked or will peak in the near term.”

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