Hany Rashwan, CEO of 21Shares, discusses Bitcoin ETF, historical bull markets, tokenization, institutional interest vs retail, regulation, and altcoin ETFs.
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Quick takeaways
The launch of a Bitcoin ETF has generated significant interest from retail investors and smaller institutional players, with larger institutional investors expected to enter the market in the next few months.
Altcoin ETFs are gaining traction and will play a crucial role in expanding the crypto market and attracting more institutional and retail investors.
Deep dives
Bitcoin ETF and Institutional Interest
The podcast episode discusses the recent launch of a Bitcoin ETF and the high inflows it has received in the first two weeks. The guest, Hani Rashuan, explains that the sustained excitement and high inflows indicate significant interest in the ETF and Bitcoin. However, he clarifies that the current inflows are primarily driven by retail investors and smaller institutional players, such as family offices and hedge funds. The larger institutional investors, like pension funds and insurance companies, have not yet entered the market due to regulatory procedures and due diligence processes. Hani expects significant institutional inflows in the next three to six months, which could have a major impact on the market and sentiment surrounding Bitcoin.
The Bull Market and Size of Institutional Allocations
The podcast delves into the potential impact of the bull market on institutional allocations to Bitcoin. While the Bitcoin ETF launch is generating excitement, the guest suggests that the bull market is driven more by retail investors and the having event, rather than institutional interest. He explains that institutions are going through a decision-making process regarding Bitcoin and will gradually enter the market with sizable allocations. Hani anticipates that large institutional investors could allocate 10 to 20 basis points of their assets to Bitcoin, which would have a significant impact on the market. However, he believes that allocations of 5% or 10% are more likely on the fund and family office side, rather than for traditional institutional investors.
Expanding Interest in Altcoin ETFs
The podcast highlights the growing interest in altcoin ETFs and the potential for their future popularity. The guest notes that while Bitcoin dominates the market, there is increasing demand for exposure to other assets and cryptocurrencies. Hani mentions the challenges of introducing altcoin ETFs due to staking and regulatory considerations, but remains optimistic about their eventual approval. He predicts that as regulatory clarity improves and more geographies allow the listing of altcoins, the demand for altcoin ETFs will rise. Hani suggests that altcoin ETFs will play a crucial role in expanding the crypto market and driving additional institutional and retail interest.
Geographical Differences and Regulation
The podcast explores the differences in regulatory environments and investor interests across geographies. It emphasizes the need for a tailored approach to cater to the preferences and requirements of different populations. The guest highlights examples such as the use of tokenization and different product structures to appeal to specific geographies. He mentions the interest in gold-backed products for gold enthusiasts and the focus on Sharia-compliant products for regions with Islamic banking principles. The guest also discusses the evolving regulatory landscape, where the US is taking inspiration from other countries, and different geographies are adapting their regulations to accommodate various types of crypto assets.
Hany Rashwan is the Co-Founder & CEO of 21Shares. In this conversation, we talk about the bitcoin ETF, historical bull markets, tokenization, institutional interest vs retail, regulation, altcoin ETFs, and more.
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