What once seemed financially impossible is now becoming more of a reality. Three financial giants, including BlackRock, have applied for Bitcoin spot Exchange-Traded Funds (ETFs). This news has created a wave of optimism and speculation, resulting in the latest BTC price surge. While institutional involvement is expected to play a role in BTC’s price surge, it can be argued that retail investors can be the ones to signal a major appreciation in digital currency.
Retail Investors Drive Significant Price Surges in Crypto
According to Michael Shaulov, the CEO and co-founder of institutional custody platform Fireblocks, retail investors are the ones who ultimately drive any significant price surges. Unexpectedly, the mid-2020s had seen “massive inflows” of institutional money on Bitcoin, yet the prices stagnated until retail investors became involved in the crypto assets later in the same year. Retail investors, with their less sophisticated trading approaches, have contributed to 50% price surges in Bitcoin, causing more pronounced fluctuations.
Shaulov is also convinced that the narrative of Bitcoin is still “playing out” for these institutions. He believes that Bitcoin is the ultimate asset to ensure security when everything goes south. This digital form of currency is independent of government-involved transactions, he adds. Due to its limited supply, significant Bitcoin purchases can impact its trading price, especially when acquired by influential parties.
SEC Faces Dilemma with Blackrock’s ETF Filing
Given the recent ETF filing from Blackrock, the U.S. Securities and Exchange Commission could be in a tricky position when it comes to approving or denying the application. Blackrock’s influence may make it hard to reject, potentially causing a significant Bitcoin rally if approved. As of the present, Bitcoin has already regained the $25,500 level and continues to rise.
Big financial institutions’ engagement in Bitcoin creates diverse narratives, like an effective hedge or public reserve currency. Up to 20% of Americans have owned Bitcoin at some point, which supports the influence of retail investors.
Retail investors play a significant role in the Bitcoin market, impacting price surges that institutional traders should consider. BTC price surges can be triggered by retail investors, even as major financial institutions generate optimism for Bitcoin. Retail investors cautiously entering the Bitcoin market may drive price surges for the digital currency.
Disclaimer: Cryptocurrency trading involves significant risks and may result in the loss of your capital. You should carefully consider whether trading cryptocurrencies is right for you in light of your financial condition and ability to bear financial risks. Cryptocurrency prices are highly volatile and can fluctuate widely in a short period of time. As such, trading cryptocurrencies may not be suitable for everyone. Additionally, storing cryptocurrencies on a centralized exchange carries inherent risks, including the potential for loss due to hacking, exchange collapse, or other security breaches. We strongly advise that you seek independent professional advice before engaging in any cryptocurrency trading activities and carefully consider the security measures in place when choosing or storing your cryptocurrencies on a cryptocurrency exchange.
