Bitcoin’s long-term outlook is brightened, according to Arkie’s Cathie Wood.
The CEO and investment director of the popularly active management company told CNBC this week that cryptocurrency catalysts are adding up as they sink to unprecedented highs.
“I think the likelihood of an ETF has increased,” Wood told CNBC’s “ETF Edge” in a generalized interview Wednesday.
With the appointment of Gary Gensler, a longtime financier who taught digital currency classes at the Massachusetts Institute of Technology, to head the Securities and Exchange Commission, the watchdog could become a cryptocurrency during the administration of Biden, said Wood.
“I think now there are people involved who really understand the space and I think the likelihood has increased” for a bitcoin ETF based in the United States.
This week, Purpose Investments gained approval for the first physically supported Bitcoin ETF in Canada. The fund began trading on Thursday.
Now that U.S. companies, including Tesla, Ark Invest’s favorite, are adding bitcoins to their balance sheets, their profit potential has grown exponentially, Wood said.
“We expected institutional interest to recover this year and certainly yes, but the way it has been captured has surprised us,” he said. “I don’t think we would have thought there would be a broad substitution of Bitcoin for cash on corporate balance sheets, so we found it very interesting.”
Tesla revealed a $ 1.5 billion bet on bitcoins through SEC filings earlier this month. Several other major players in the US market, including BlackRock, Mastercard and Square, have also announced moves to the space.
“If all U.S. companies put in … 10% of their cash in bitcoins, that alone would add $ 200,000 to the price of bitcoins,” Wood said. “Now, obviously, we don’t think that’s going to happen very quickly. We’re talking maybe the equivalent of [a] $ 900 billion market capitalization. “
According to the digital currency news site Coindesk, the market value of Bitcoin rose $ 1 trillion on Friday.
“This needs to mature a bit before large-scale adoption can take place, but we’re pretty sure companies like Square and Tesla have decided to assign them,” Wood said Wednesday.
See founder Som Seif’s, founder of Purpose Investments “ETF Edge” Interview on their newly launched bitcoin ETF here.