MicroStrategy's Michael Saylor sees Ethereum ETFs as an open door for broader crypto adoption

Saylor, who had previously expressed concerns about the SEC approving Ethereum ETFs, has recently adjusted his position

Published: May 27, 2024 03:55:50 PM IST

Updated: May 27, 2024 03:56:57 PM IST

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MicroStrategy's Chair, Michael Saylor, views the SEC's approval of a spot Ethereum ETF as a positive development for Bitcoin. He anticipates this move will draw more institutional investors into the crypto market.

In early May, Saylor expressed concerns about the SEC potentially taking action against significant alternative crypto assets (altcoins). This raised worries within the crypto community that the SEC might classify Ethereum ETF and other altcoins as securities, leading to stricter regulations and potential limitations on trading these assets.

In a surprising turn of events, the SEC's approval of all spot Ethereum ETFs differed from earlier expectations. Michael Saylor has adjusted his previous stance and now welcomes the SEC's decision.

Following the SEC's approval of several spot Ethereum ETFs in late May, Saylor expressed his belief that this development could be even more beneficial for Bitcoin. He suggested that the broader recognition of crypto as an asset class, facilitated by the ETFs, would strengthen Bitcoin's position within the industry due to its established presence. He further indicated that these ETFs might act as a stabilising factor for Bitcoin in the regulatory landscape.

Saylor further emphasised that the SEC's decision could accelerate institutional investors' adoption of crypto assets. This could lead to a potential allocation of 5-10% of their investment portfolios towards cryptocurrencies. Within this allocation, he projects Bitcoin to capture a significant share, potentially around 60-70 percent, due to its established position in the market. He explained this by suggesting that previously hesitant investors might now view crypto as a legitimate asset class due to the existence of ETFs. Saylor anticipated that these investors would likely diversify their crypto assets holdings. Still, Bitcoin, as the established leader in the space, would likely receive the largest share of their crypto assets allocations.

Saylor elaborated that just two weeks prior to the SEC's decision, the expectation was that Bitcoin would be the sole cryptocurrency offered as a security through a spot ETF by Wall Street institutions, effectively solidifying its position as the only legitimate crypto asset class.

Shashank is the founder of yMedia. He ventured into crypto in 2013 and is an ETH maximalist.

Twitter: @bhardwajshash