Crypto investors are in for a ‘very exciting spring,’ says Van Eck CEO
The Van Eck CEO says conditions are leading to a “close to perfect setup” for crypto
Peter de Kievith/Shutterstock modified by Blockworks
Politically-motivated rate cuts could coincide with the bitcoin “halvening” — as well as potential spot bitcoin ETF launches — making for a “very exciting spring” for crypto investors, Van Eck says.
“We’re near the end of this Fed cycle of tightening,” he says. “We’re certainly closer to the end than the beginning.”
“If one is cynical about the election, then you want at least six months for lower rates to kick in,” he adds.
On the Empire podcast (Spotify/Apple), the Van Eck CEO admits he is not a “mind reader” when it comes to the timing of potential spot bitcoin ETF approvals. But he sees “movement at the [US Securities and Exchange Commission] now, where there was absolutely no movement until a month ago.”
Van Eck points to how the SEC recently approved ether futures ETFs as a potential model for spot bitcoin ETF applications. “The SEC said, ‘Listen, we don’t want to give anyone an issue or an unfair advantage.’”
Van Eck explains that during the approval process for ether futures ETFs, the SEC said to the applicants, “we’re going to try to get you all to market on the same day.”
“And they did. It’s really the first time in ETF history where something like that has happened.”
“I would imagine a similar thing is in their mind for spot bitcoin,” he says.
It’s important because everyone thinks it’s important
Van Eck suggests that approval of spot bitcoin ETFs is “more symbolic than anything else,” adding, “it’s important because everyone thinks it’s important.”
“Globally, everyone has their eye on the SEC on this issue,” he says. But at a practical level, he says, “it’s going to be a great product as well.”
“If you look at the spot bitcoin products that trade in Canada, Brazil and Europe, they trade at really tight spreads.”
Read more: US spot bitcoin ETF not impossible — just ask the rest of the world
“The established dock exchanges around the world have very hardened infrastructure,” he says, “so you’re finding a product that trades really tight, very reliably, in a regulated manner.” In addition, Van Eck says spot ETF products hold an advantage in that they are “super tax efficient” for Americans when compared to futures-based products.
Like platinum and silver, he says, bitcoin has now been established as an alternative to demand for gold as a store of value. “You’ve got an almost close to perfect setup as a trade.”
“You’ve got the Fed changing its policy or, you know, nearing the end of it. You’ve got the halvening. You’ve got other uncertainties that are there and you’ve got the liquidation that has occurred in the market.”
Read more: AllianceBernstein calls bitcoin a ‘safe haven asset,’ more attractive than gold
“I guess the narrative around the FTX bankruptcy is [that] their portfolio will be liquidated,” Van Eck says, adding, “I just can’t imagine who else there is to sell.”
“If you look at the statistics on on-chain and [centralized finance] sales of bitcoin and other coins,” he says, “it’s all supportive of that simple story.”
The only thing that doesn’t make sense, Van Eck says, is that the market never seems to “price it in.”
“This is one of the mysteries of the financial markets. You know the halvening always leads to a bull market,” he says. “Why don’t people anticipate this?”
“There’s no accounting for the crowd.”
Get the news in your inbox. Explore Blockworks newsletters:
- The Breakdown: Decoding crypto and the markets. Daily.
- 0xResearch: Alpha in your inbox. Think like an analyst.
- Empire: Crypto news and analysis to start your day.
- Forward Guidance: The intersection of crypto, macro and policy.
- The Drop: Apps, games, memes and more.
- Lightspeed: All things Solana.
- Supply Shock: Bitcoin, bitcoin, bitcoin.
