Bloomberg's exchange-traded fund (ETF) analyst James Seyffart believes that the next phase of adoption of crypto asset ETFs will be driven by financial advisors, large brokerage firms and brokers who manage assets for high-net-worth individuals.
In an episode of the "Coin Stories" podcast, Seyffart outlined how these financial institutions, which manage trillions of dollars in assets, can play a central role in expanding the BTC ETF market.
He noted that the BTC ETF's first year in the market was exceptionally strong, exceeding the expectations of many analysts. While Bloomberg is optimistic about the BTC ETF, he admitted that the actual performance exceeded their predictions.
Seyffart said: "There have been some outflows in recent weeks, but since launch, the size of funds has only decreased by about $40 billion at its peak, and the assets of these ETFs are currently around $110 billion. IBIT has been one of the most actively traded ETFs, reaching a size of $50 billion in just a hundred days, and the previous record was more than a thousand days. So no matter how you look at it, they have broken all the records that can be seen."
Given this momentum, he believes that the use of BTC ETFs as a tool for high-net-worth clients to allocate their portfolios may drive their continued success.
Although large companies like BlackRock recommend allocating 1% to 2% of BTC in a portfolio, Seyffart stressed that "large brokerage firms and large banks" do not allow investors to buy Crypto asset ETFs.
He added that these brokerage firms, financial advisors, and brokerage platforms control a lot of money, including billionaires.
These institutions influence asset allocation decisions in a wide range of financial portfolios. Seyffart said that if these institutions begin to include BTC ETFs as part of their portfolios, such as 5%, this could drive continued growth in adoption.
In addition to institutional adoption, Seyffart also noticed a trend of companies, states, and even countries including BTC on their balance sheets. This helps to enhance the legitimacy and stability of BTC as an asset class in the traditional financial sector.
However, he emphasized that increased acceptance by financial intermediaries may be a key driver of ETF growth.
Today, asset management company Grayscale released a report claiming that high-net-worth investors have taken an interest in Crypto assets.
Grayscale CEO Peter Mintzberg said on social media: "It is great to see that the momentum of Crypto assets is shifting, and more and more investors are beginning to recognize the value of digital assets. It is worth noting that 38% of high net worth investors believe that their portfolios will include Crypto assets in the future."
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