Bitcoin ETFs Helped With Crypto Credibility, Says Hashed Emergent Associate Shubham Jain

Key Takeaways

• Bitcoin ETFs have boosted the credibility and accessibility of cryptocurrencies, notes Hashed Emergent’s Shubham Jain.
• Asia is emerging as a key crypto hub with Hong Kong set for Bitcoin ETFs.
• Bitcoin ETFs offer a new avenue for institutional and retail investors.

Bitcoin ETF inflows have remained positive since the January debut. With the Ethereum ETF applications in the pipeline, CCN spoke to Shubham Jain, Senior Associate for Investment at VC firm Hashed Emergent. Meanwhile, Asia has emerged as a parallel player to the US, sometimes surpassing the West in regulatory attractiveness.

Role of Bitcoin ETFs in Global Markets

Jain explained that crypto Exchange Traded Funds (ETFs) have been crucial in making digital assets more trustworthy and accessible.

He told CCN: “ETFs have played a key role in enhancing the credibility of crypto-assets and broadening access for individuals unfamiliar with the crypto space.”

Jain added: “The substantial influx of new investments into Bitcoin ETFs has led to capital circulation throughout the crypto market. This serves as a significant catalyst for the ongoing bullish trend.”

In March, trading volume for spot Bitcoin ETFs hit a record high, exceeding $111 billion, almost three times the volume recorded in the previous months. Looking forward, Jain believes certain events will further increase Bitcoin’s value and appeal.

He said: “The Bitcoin Halving event is expected to constrain token supply, historically serving as a strong upward price driver.”

Jain also mentions that when financial institutions finish their usual review process of new products, like Bitcoin ETFs, there might be more money invested in them.

Additional Capital Inflows

The senior associate expects the review period for spot Bitcoin ETFs to conclude in April, potentially more additional capital inflows.

According to Glassnode , when Bitcoin’s price hit its all-time high of $73,000 in mid-March, the amount of BTC traded each day reached about $14.1 billion. The platform reports the level of trading activity is similar to that during the Bitcoin rally between 2020 and 2021.

Apart from the US, Bitcoin ETFs also provide access to the emerging markets.

According to a report by the firm, India was the leader in on-chain adoption in 2023. It managed to outperform over 150 countries in the process.

According to Jain: “For India particularly, Bitcoin ETFs offer sophisticated investors a gateway to digital assets. We anticipate prominent asset management firms in India will develop index funds based on these ETFs.”

Sumit Gupta, co-founder of Indian crypto exchange CoinDCX, said: “Institutional involvement has historically served as a driving force behind the increased attention and traction observed in various asset classes. The recent approval by the US SEC of 11 Bitcoin ETFs resulted in a substantial $1.2 billion of assets being locked within just three months.”

Gupta added: “This influx of funds, coupled with positive sentiment, contributed to the notable rally in Bitcoin prices. It is indeed heartening to witness developed countries such as the US and Hong Kong taking proactive steps to propel the crypto industry forward. The fact this development has occurred in Asia for the first time brings it closer to our home.”

The executive anticipates that crypto industry is moving in a direction that will gradually improve adoption, creating a promise for future growth and acceptance.

Asia Remains a Crucial Crypto Market

Jain emphasized that Asia is at the forefront of web3 innovation, supported by vast consumer markets, increasing institutional adoption, and a maturing regulatory framework.

He said: “Asia has been a leader in crypto adoption. According to Chainalysis, six of the top ten countries leading in crypto adoption are situated in the Asia-Pacific region. These are India, Vietnam, the Philippines, Indonesia, Pakistan, and Thailand.”

The associate cited reports that traders from South Korea and China have accounted for about 70% of Bitcoin trading.

Jain added:  “India alone accounts for more than 35 million user accounts on the top two exchanges.”

Although Asia remains a crucial market, Hong Kong’s approval of Bitcoin ETFs has set a precedent for its counterparts.

Jain also claims that 75% of Singapore-based investors plan to increase their investments in digital assets by 2024.

He also reiterated that places like Hong Kong, Singapore, Dubai, and Abu Dhabi are creating supportive regulatory environments for digital assets. While that happens, a Japan-based company has already started accumulating Bitcoin.

Japanese company Metaplanet has announced a change in their financial approach by investing 1 billion Japanese yen in Bitcoin and making it their main financial asset.

While the move is reportedly to position themselves as leaders in digital finance, it is a reminder of how MicroStrategy, Tesla and other tech giants in the US have accumulated BTC.

Asia Moves in Parallel to the US

After speaking with Jain, it looks like the cryptocurrency market is in a transformative phase, buoyed by Bitcoin ETFs. In this transformation, Asia has emerged as a major player.

Hong Kong’s greenlight to a Bitcoin ETF and a positive approval decision on Ethereum ETF by the SEC can be catalysts for a growing investor base in the East and the West.  

About the Author

Shraddha Sharma

Shraddha has around five years of experience as a financial journalist, focusing largely on the Asian markets. Starting her career in Mumbai, India, as a news trainee and producer, she quickly found her niche in crypto. She is keen on learning how emerging technologies affect the broader markets and enjoys explaining complex financial ideas in a way that's easy to understand.

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