With the SEC opening the floodgates to spot bitcoin ETFs last week, VanEck’s Director of Digital Assets Product Kyle DaCruz thinks that interest in cryptocurrency products and bitcoin ETFs is “only going to spike.”
“I think from here on out, it’s going to just be continued interest and demand,” he said during a panel on VettaFi’s Cryptocurrency Symposium on Friday.
DaCruz said that after a few issues in the market, including cases of fraud, interest in bitcoin “had been muted,” and “rightly so.” But “now that these regulated products have come to market, interest is only going to spike.”
“As time goes on and as platforms continue to add access…we’ll start to see greater availability,” he noted. “There is some oversight and regulation in place.”
Blockchain: A Transformative Technology
While many investors think of crypto and blockchain as potentially “dangerous,” DaCruz argued that “if used properly, it’s a technology that can keep us all honest.”
“Blockchain can potentially be a transformative technology that solves a lot of the issues we’ve had in this space,” he commented. “It’s an educational barrier to overcome.”
And based on the results of a poll conducted by VettaFi, advisors are most worried about volatility when investing in crypto, with 33% of respondents citing that as their top concern. Meanwhile, 27% of respondents cited crypto’s difficulty to value as their top concern.
DaCruz thinks that bitcoin fits into a portfolio’s real-assets bucket. He cited research showing that a 1% “allocation to bitcoin in a 60/40 portfolio can actually improve not just the returns but the overall risk-adjusted Sharpe ratio.”
The Launch of HODL
DaCruz said that what sets VanEck apart is that the issuer has “been in crypto since 2017,” which provides “native experience” and can educate investors “on this emerging technology.”
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