Most Financial Advisors Believe Bitcoin ETFs Will Be Denied: Bitwise Survey

Optimism over a Bitcoin ETF may not be as prevalent in mainstream financial circles as within the online crypto community, according to new survey results published by Bitwise.

The crypto index fund provider – which itself is awaiting approval for its Bitcoin ETF application – said that only 39% of surveyed investment advisors believe an ETF will be approved in 2024.

Advisors Doubt The Bitcoin ETF

The survey took place between October 20 and December 18 – a period of significant price appreciation for Bitcoin amid confidence that an ETF approval was imminent and inevitable.

This followed major events signaling that regulators might flip their heretofore hostile stance against spot ETFs, including a June ETF application from BlackRock and an August court victory for Grayscale over the Securities and Exchange Commission (SEC).

By the time the survey began, the SEC had already lost all remaining time to appeal its court loss, forcing the agency to re-examine ETF applications in a more welcoming light.

“I read this as most boomer advisors are not spending inordinate amounts of time on Twitter or even online,” said Bloomberg ETF analyst Eric Balchunas in response to the survey.

Balchunas and his fellow analyst James Seyffart maintain that Bitcoin ETF applicants have a 90% likelihood of receiving approval between January 8 and 10, given the SEC’s lengthy and constructive dialogue with applicants over the past two months.

Some reports suggest that issuers could receive notifications of approval as early as Friday before beginning to trade early next week. Additionally, Balchunas said on Thursday that the SEC is “giving final comments as we speak” and that approvals are “as close to “done” as we’ve been.”

Multiple asset managers have also given subtle hints that approvals are imminent this week. SkyBridge Capital founder Anthony Scaramucci tweeted, “It’s done” on Thursday, while Grayscale’s chief legal officer said he was “just filling out some forms.”

Is This Bullish?

Bitwise CIO Matt Hougan interpreted investment advisors’ lack of faith in approvals as a bullish sign, signaling that the event is not yet “priced in” to Bitcoin.

“There’s a massive gap in expectations between advisors and those who monitor ETF developments for a living,” stated Hougan. “Couple that with the fact that almost 90% of advisors say they’re waiting for an ETF before making a bitcoin investment, and you see a lot of demand bubbling just below the surface.”

Bitwise’s survey also found that only 19% of advisors can buy crypto in client accounts, even though 88% of advisors were questioned by clients about crypto last year.

“Seventy-one percent (71%) of advisors favor Bitcoin over Ethereum, a marked increase from the previous year (53%),” the company added.