Tether CEO Paolo Ardoino predicts a surge in Bitcoin adoption from traditional finance, following the landmark approval of spot Bitcoin exchange-traded funds (ETFs) in the US. Speaking at a Bitfinex event alongside Blockstream CEO Adam Back, Ardoino highlighted the growing interest from hedge funds, pension funds, and corporations in incorporating Bitcoin into their portfolios.
Ardoino expects fund managers to allocate up to 5% of their holdings to Bitcoin, citing the legitimacy provided by spot ETFs. He believes this trend will be further fueled by the potential for Bitcoin to act as a hedge against economic and political instability, similar to how companies like Tesla and MicroStrategy currently utilize it.
Spot ETFs: A Catalyst for Growth
The launch of spot Bitcoin ETFs has already had a significant impact. These funds, which now hold over $42 billion in assets, have contributed to a rise in Bitcoin’s price, reaching $58,000 as of February 28th, marking a new high since November 2021. Some experts attribute this price increase directly to the trading volume generated by these new ETFs.
Policymakers Playing Catch-Up
Ardoino believes policymakers and regulators will need to adapt to the changing landscape, referencing El Salvador’s recent adoption of Bitcoin as legal tender. He compared this situation to the initial skepticism surrounding Bitcoin ETFs, which ultimately gained widespread acceptance and fueled an ETF launch frenzy.
Regulation on the Horizon: While the US currently lacks a comprehensive regulatory framework for cryptocurrencies and stablecoins, efforts are underway to address this gap. Lawmakers are actively working on relevant bills, and SEC Chair Gary Gensler has classified Bitcoin as a commodity, potentially creating a clearer regulatory path for its adoption.
Also Read: Bitcoin Breathes Easy: Mempool Shrinks 61% as Network Clears 139 Million Byte Backlog in February
Looking Ahead
Ardoino’s predictions paint a picture of an increasingly mainstream Bitcoin, embraced not just by individual investors but also by established institutions. Whether this translates to long-term stability and growth for Bitcoin remains to be seen, but the current momentum suggests a significant shift in its perception and potential future trajectory.
About The Author
