Galaxy predicts 74% Bitcoin price increase first year after ETF launch
Bitcoin’s ( BTC ) price will increase 74.1% in the first year after spot Bitcoin exchange-traded funds (ETFs) are launched in the United States, according to estimates from crypto investment firm Galaxy Digital.
In an Oct. 24 blog post , Galaxy Digital research associate Charles Yu estimated 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 assessing the potential price impact of fund inflows to Bitcoin ETF products using gold ETFs as a baseline.
According to Yu’s estimates, Bitcoin’s price would increase 6.2% in the first month after an ETF launch before steadily trending downward to a 3.7% monthly increase by month 12.
Spot Bitcoin ETF estimated one-year inflows by month and Bitcoin price impact. Source: Galaxy Digital Research
Yu used Bitcoin price data from Sept. 30, but a 74.1% increase in Bitcoin’s current price would see it hit $59,200 .
Markus Thielen, head of research at digital asset financial services firm Matrixport reached a similar figure in an Oct. 19 post , estimating Bitcoin could rise to between $42,000 and $56,000 if BlackRock’s spot Bitcoin ETF application is approved.
Yu predicts the U.S. Bitcoin ETFs’ addressable market size to reach $26.5 trillion in the second year after launch and $39.6 trillion after the third year.
Spot Bitcoin ETF market sizing and inflow estimates over the first three years. Source: Galaxy Digital Research
Related: BlackRock’s Bitcoin ETF: How it works, its benefits and opportunities
Yu acknowledged a delay or denial of spot Bitcoin ETFs would impact its price prediction.
However, he said the estimates were still conservative and didn’t factor in “second-order effects” from a spot Bitcoin ETF approval.
“In the near-term, we expect other global/international markets to follow the U.S. in approving + offering similar Bitcoin ETF offerings to a wider population of investors,” Yu wrote.
He added “2024 could be a big year for Bitcoin” citing ETF inflows, the April 2024 Bitcoin halving and “the possibility that rates have peaked or will peak in the near term.”
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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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