- Bitcoin ETFs have emerged, but advisors remain cautious due to Bitcoin’s volatility.
- Bernstein predicts Bitcoin’s price could hit $1 million by 2033 due to high demand.
When Bitcoin Exchange-Traded Funds (ETFs) were introduced in January, cryptocurrency investing underwent a new chapter. Even with their promises, financial counselors proceed cautiously because of the significant risk and volatility of these funds.
Samara Cohen, Chief Investment Officer of ETF and Index Investments at BlackRock, pointed out at the recent Coinbase State of Crypto Summit that self-directed investors use online brokers to complete a noteworthy 80% of Bitcoin ETF transactions, according to CNBC.
Analyzing Bitcoin’s Market Impact
The infamous price swings of Bitcoin, which have in the past risen as high as 90%, are what motivate financial advisors’ concern.
Meanwhile, according to CoinMarketCap data, BTC is trading for about $66,755.61, slightly up 0.87% in the last day but down 3.92% over the previous seven days.
To determine where Bitcoin belongs in investing portfolios, advisors concentrate on hard facts and risk assessment while taking investor risk tolerance and liquidity requirements into account.
Cohen stressed the advisors’ fiduciary duty to their customers and the need for due diligence and a comprehensive risk analysis.
Future Prospects and Analyst Predictions
Though most financial counselors are cautious, some market analysts believe Bitcoin will have a bright future.
Major asset management company Bernstein projects that by 2033, spot ETF demand will be robust and Bitcoin’s supply will be limited, driving a spike to $1 million, as previously reported by ETHNews.
The significant net fresh flows, estimated at $15 billion from ETFs, which Bernstein projects will represent almost 7% of the Bitcoin in circulation by 2025 and almost 15% by 2033, support this upbeat conclusion.