According to Ark Invest’s Cathie Wood, Bitcoin’s long-term prospects are better.
The CEO and chief investment officer of the explosively popular active management firm told CNBC this week that cryptocurrency’s catalysts add up as they hit unprecedented new highs.
“I think the likelihood of an ETF has increased,” Wood said in a comprehensive interview on CNBC’s “ETF Edge” on Wednesday.
With Gary Gensler – a longtime financier who taught a digital currency class at the Massachusetts Institute of Technology – nominated to head the Securities and Exchange Commission, the watchdog could warm to crypto during the Biden administration, Wood said.
“I think we now have individuals who really understand the space, and I think the likelihood has increased” for a US-based bitcoin ETF.
Purpose Investments this week received approval for Canada’s first physically secured Bitcoin ETF. The fund traded on Thursday.
Now that U.S. companies, including Ark Investment’s favorite Tesla, are adding Bitcoin to their balance sheets, the profit potential has grown exponentially, Wood said.
“We expected institutional interest to increase this year, and it certainly did, but the way it was received surprised us,” she said. “I don’t think we ever thought that bitcoin could replace cash on corporate balance sheets, so we find that very interesting.”
Tesla announced a $ 1.5 billion stake on Bitcoin earlier this month through SEC filings. Several other major players in the US market, including BlackRock, Mastercard, and Square, have also announced moves into space.
“If all companies in the US … put 10% of their money in bitcoin, that alone would add $ 200,000 to the price of bitcoin,” said Wood. “Now we obviously don’t think this will happen very quickly. We’re talking about perhaps the equivalent of [a] Market capitalization of $ 900 billion. “
Bitcoin’s market value cracked $ 1 trillion on Friday, according to Coindesk, a digital currency news website.
“This will have to mature a bit before a large-scale acquisition can take place, but we are very reassured that companies like Square and Tesla have made an allotment,” Wood said on Wednesday.
Watch Purpose Investments founder Som Seif’s “ETF Edge” Interview about his recently launched Bitcoin ETF Here.