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How Bitcoin’s ETF Can Im...


How Bitcoin’s ETF Can Impact Other Coins

How Bitcoin’s ETF Can Impact Other Coins
The Silicon Review
18 March, 2024

Since its introduction to the world and subsequent success, Bitcoin has been a game changer that disrupted the financial world in a number of ways. The massive success it achieved spawned a modern-day gold rush that's now seen the creation of more than 20,000 new cryptocurrencies in its wake. With colossal booms and gains over the years, everyone's been waiting for the next big thing from Bitcoin and how to capitalize on it.

With the announcement of the intention to create a spot ETF for cryptocurrency by BlackRock last year, the market has been transfixed by that happening ever since. While Bitcoin is no stranger to major periods of volatility and immense growth, it's been a long time since the market has been this excited by how much potential for growth lies ahead. However, while Bitcoin holders and ordinary investors are optimistic about it all, the question is, where does this leave other coins?

If you're ever wondering how much of an impact Bitcoin has, just check out how much it affects major exchanges like Binance. At any time this year, if you check out new Binance listings to watch in 2024, chances are one or more of the new offerings will have something to do with Bitcoin. For example, Elliott Lee says Green Bitcoin is a good alternative for those missing out on BTC’s huge returns, and that it is 10,000 times more eco-friendly than Bitcoin.

Despite how many thousands of other cryptocurrencies have been created in its wake, Bitcoin remains the most famous, valuable, and successful of them all. Still the behemoth among cryptos, as it always was, any seismic shift in Bitcoin is always likely to have a knock-on effect on other coins.

Since the majority of new offerings are all either forked from Bitcoin or Ether, no matter how far removed a cryptocurrency may seem, most owe their entire existence to Bitcoin. The announcement by BlackRock about its plans for a spot ETF for Bitcoin was huge. If you don't know this already, BlackRock is an American investment company that can boast being the world's largest asset manager. At the helm of a whopping $10 trillion in assets, anything BlackRock does in terms of its investment strategies, has the power to move the entire financial world.

It's because of this almost unfathomable amount of financial power that everyone in the financial world has learned to stand up and take notice of anything BlackRock may be interested in. When the announcement of the ETF for Bitcoin was announced, it immediately generated a ton of optimism and investor confidence in Bitcoin. With the potential to send its price soaring into the stratosphere, investors everywhere were of course interested to know how this would all play out.

However, it was never going to be a straightforward affair. First of all, Bitcoin and cryptocurrencies in general had been treated wearily by mainstream investment companies for a long time due to their volatility. Despite this, coins like Bitcoin still proved enormously popular and lucrative as they reached some epic heights over the years. Bitcoin's robust nature took it from what many institutional organizations believed was a passing craze to a revered disruptor of the financial world, and the possible progenitor of a new financial revolution one day.

Despite all Bitcoin and other successful cryptocurrencies have accomplished on their own, when BlackRock made their announcement, it was still a major signal that things were about to shift seismically again in the crypto world. An ETF, or exchange-traded fund is a financial offering that allows a mainstream fund to provide its investors with exposure to Bitcoin's price movements. However, the best part is that it would allow for this without those investors having to ever actually buy any Bitcoin.

Rather than Bitcoin and other cryptocurrencies being traded on crypto exchanges, an ETF means it can be traded on traditional stock exchanges, almost like buying stock in a company. This is huge news for the coin itself as it essentially opens the floodgates for investors to begin trading of confidence in its price. That itself will likely be enough to create some of that confidence or at least play a part in the factors that do. For other coins, and cryptocurrencies as a concept, it also means a huge victory too.

The reason is that cryptocurrencies as a concept were initially treated as a joke, or widely panned by the financial world when they were first introduced. Despite all the rejection and criticism they faced, their underlying blockchain technology won out as it was simply too indigenous to remain a fringe concept. With the ability to stay outside of mainstream regulation by central authorities, the ability to self-verify transactions, and basically offer a safer and more instantaneous way to trade, cryptocurrencies proved their utility beyond anything the financial world could have ever expected.

Buoyed by Bitcoin's success and more widespread adoption as a result, many Altcoins have followed its success and become more widely accepted too. There are now a virtually endless number of things that can be bought and sold with cryptocurrencies, with prominent uses including their adoption in crypto casinos and even among high-end luxury online retailers increasing their popularity. As a result, Bitcoin has charted a path that has led to virtually limitless potential for other cryptocurrencies.

Key Takeaways 

  • Always a leader, with its ETF, Bitcoin has pumped the greater crypto market full of optimism and investor confidence.
  • Its success cannot be gainsaid as it opens the door for other currencies to follow suit.
  • If this all goes as well as most investors and financial experts are predicting it might, there will likely be a lot more ETFs for other coins in the offering soon enough.
  • Nothing is guaranteed, and there are always risks that investors must be wary of. However, for now, BlackRock’s Bitcoin ETF seems likely to be a huge positive for the crypto world.