Steven McClurg, the co-founder and Chief Investment Officer (CIO) of Valkyrie Investments, recently engaged in a comprehensive discussion with Talia Kaplan on CNBC Crypto World. The conversation centered around Valkyrie’s pending application for a spot Bitcoin Exchange-Traded Fund (ETF) in the United States, alongside other asset managers like BlackRock, Fidelity, and WisdomTree.
Anticipated Approval of Spot Bitcoin ETF
McClurg expressed optimism about the approval of Valkyrie’s spot Bitcoin ETF application, likely between January and March of the coming year. He believes that multiple applications, including Valkyrie’s, will receive approval simultaneously. To prepare, Valkyrie is diligently working on necessary steps like setting up a fund administrator, custodian, and market makers.
SEC’s Stance on Crypto and ETFs
Discussing the Securities and Exchange Commission’s (SEC) approach to cryptocurrency, McClurg highlighted SEC Chair Gary Gensler’s positive stance towards Bitcoin and the crypto industry. He noted that the first Bitcoin Futures ETF was launched under Gensler’s watch, following his guidance. McClurg also mentioned the recent court victory of Grayscale against the SEC, which might influence the SEC’s decision-making process regarding spot Bitcoin ETFs.
Interaction with the SEC
Valkyrie maintains regular communication with the SEC staff, focusing on ensuring effective market functioning and comprehensive disclosures in their filings. McClurg anticipates the launch of the spot Bitcoin ETF after January 2nd, contingent on the SEC’s readiness.
Impact of Spot Bitcoin ETFs on Crypto Market
McClurg believes the approval of spot Bitcoin ETFs will significantly benefit Bitcoin, though it may not have the same effect on all cryptocurrencies. He sees Bitcoin as distinct from other cryptos, some of which the SEC still views as potentially being securities.
Influence of BlackRock’s Filing
Valkyrie’s decision to file for a spot Bitcoin ETF was independent of BlackRock’s similar move. Valkyrie had initially filed for a spot Bitcoin ETF in early 2021 and has been actively working on it since then.
Market Dynamics and Bitcoin’s Price Movement
McClurg identified three key factors influencing Bitcoin’s price: spot ETF excitement, the cyclical nature of the Bitcoin industry, and expectations of lower interest rates in the near future. He anticipates the Federal Reserve might cut rates around May, potentially boosting risk markets.
Outlook for Bitcoin and Crypto in 2024
McClurg is optimistic about Bitcoin’s future, predicting its price could exceed $100,000 by the end of the next year and potentially reach $150,000 by 2025. He expects increased adoption and innovation in the Bitcoin network and the broader crypto market.
Valkyrie’s Future Plans and CoinShares Partnership
Valkyrie is preparing for the potential launch of a Bitcoin spot ETF and is also exploring other opportunities in the crypto space. The recent announcement of CoinShares’ intention to acquire Valkyrie’s crypto ETF wing is seen as a strategic partnership, leveraging CoinShares’ experience as the first Bitcoin ETF issuer in Europe.
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