In a blog post on October 24th, Charles Yu, a research contributor at Galaxy Digital, estimated that the total market size for Bitcoin ETFs would reach $14.4 trillion in the first year after their launch. He arrived at this figure by assessing the potential price impact of capital inflows into Bitcoin ETF products using Gold ETFs as a reference.
According to Yu’s estimation, Bitcoin’s price would increase by 6.2% in the first month after the ETF’s launch before gradually decreasing to a monthly growth rate of 3.7% by December.
Yu used Bitcoin price data as of September 30th, but the current Bitcoin price, which has increased by 74.1%, would put it at $59,200.
Markus Thielen, Head of Research at digital asset financial services company Matrixport, made a similar prediction in a post on October 19th, estimating that Bitcoin could rise from $42,000 to $56,000 if BlackRock’s Bitcoin ETF spot application is approved.
Yu predicted that the market size of the US Bitcoin ETF could reach $26.5 trillion in the second year after its launch and $39.6 trillion by the third year.
He acknowledged that delays or rejections of Bitcoin spot ETFs could affect its price predictions. However, he noted that these estimates are still cautious and do not account for the “second-order effect” of approving Bitcoin spot ETFs.
Yu wrote, “In the coming years, we expect other global/international markets to follow the U.S. in approving + providing similar Bitcoin ETF services to a wider range of investors.”
He added, “2024 could be an important year for Bitcoin” while referencing the ETF capital flows and the Bitcoin halving event in April 2024.