As the long-awaited spot Bitcoin (CRYPTO: BTC) ETF inches closer, cryptocurrency analysts and traders are debating: will it be a "sell the news" event or ignite the next bull run?
ETF bulls cite three reasons why an approval could spark massive inflows into Bitcoin:

• Unit bias
• Institutional adoption
• Fear of missing out

Here is how experts see them play out.

Unit Bias: Bitcoin Becomes 'More Affordable'

Gabor Gurbacs, founder of VanEck's PointsVille, makes an intuitive claim: "Bitcoin exposure looks more affordable" if investors buy shares of an ETF instead of fractional Bitcoin, he says. He highlights the concept of unit bias: people prefer owning whole units of something rather than fractions.

With Bitcoin hovering around $46,000, many potential investors feel priced out.

But an ETF, with shares "removing three zeros," retail investors may become more interested. According to Gurbacs, not everyone knows you can own fractional Bitcoin:

I was surprised that a good number of people didn’t know that one can own a fraction of a Bitcoin and even more frequently people didn’t want to own a fraction of a coin.

Owning a full share feels better than owning 0.001 Bitcoin. Seems like a a small thing but it’s a big thing.

— Gabor Gurbacs (@gaborgurbacs) January 6, 2024

This contributes to his ultra-bullish price target of $2.5 trillion Bitcoin flows. Gurbacs is also not the only analyst with such high price targets.

Institutional Adoption: How Much Money WIll Flow In?

VanEck CEO Jan van Eck raises another exciting prospect: institutional adoption.

With RIAs (Registered Investment Advisors) managing a staggering $114 trillion in assets, even a small allocation to Bitcoin via an ETF could have a massive impact.

Scott Melker, host of the Wolf of All Streets podcast, puts it into perspective: a mere 0.5% allocation from RIAs would translate to $570 billion, surpassing Bitcoin's current market cap!

Jan van Eck's ongoing poll on X predicts a higher than 50% chance that inflows will exceed $30 billion in the first year:

If spot #btcETF’s are launched in the next few weeks, how much do they raise, net, by the end of the year including Grayscale’s assets today of about $25 billion?@gaborgurbacs @ramahluwalia @davenadig @vaneck_us

— Jan van Eck (@JanvanEck3) January 7, 2024

Such inflows could spark "sidelined" investors to capitulate and buy in sooner rather than later.

Beyond "Sell The News": A FOMO Catalyst For Steady Growth

Millionaire entrepreneur Alex Becker tackles the "sell the news" concern head-on:

"This isn't a sell the news," Becker emphasizes.

"It's a beginning of steady flow into the asset from the largest holders of wealth in the world." This could fuel sustained growth for Bitcoin, unlike a short-lived pump and dump.

Traditional investors, like pension funds and retirees, often lack the comfort or expertise for self-custodying large amounts of Bitcoin.

An ETF provides a familiar and secure avenue for them to gain exposure.

Also Read: Vitalik, Raoul Pal Unite In Warning Against Leverage: Here's Their Advice To Build Stable Wealth In Crypto

Crypto analyst The Crypto Dog shared a chart, suggesting the technical analysis backs up Becker's bullish claim:

There is no way something this clean doesn't pump… right? pic.twitter.com/hs52GBRIef

— The Crypto Dog 📈 (@TheCryptoDog) January 7, 2024

Finally, Kun, a well-regarded anonymous investor on crypto social media, brings up an interesting psychological factor: the fear of missing out (FOMO) and regret. Staunch believers tempted to sell into a potential price pump upon an ETF launch could quickly feel regret if prices continue to rise. The feeling of being "sidelined while being bullish" could compel these investors to re-enter the market at elevated prices.

The Verdict: Bulls Make A Good Argument For Cautious Optimism

While it's impossible to predict the future with certainty, the arguments for a positive impact from the Bitcoin ETF are compelling.

Of course, risks remain, and the "sell the news" crowd shouldn't be entirely ignored.

However, the potential rewards seem to outweigh the risks, making a cautiously optimistic outlook the most reasonable stance.

As the ETF inches closer to reality, one thing is clear: the Bitcoin market is about to get a lot more interesting. 

Read Next: Inside The Mysterious $1.2M Bitcoin, Genesis Wallet Transfer: Who's Trying to 'Flush Satoshi Out?'

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