At the low end, $42,000 is a “conservative estimate” based on the supposition that 10%-20% of gold ETF investors will take a stake in a spot bitcoin ETF

Bitcoin (BTC) will rise to as high as $56,000 if a BlackRock spot bitcoin exchange-traded fund (ETF) is approved, crypto firm Matrixport said in a report Thursday.

At the low end, $42,000 is a “conservative estimate” based on the supposition that 10%-20% of gold ETF investors will take a stake in a spot bitcoin exchange-traded fund.

Assuming that 10-20% of those precious metals exchange-traded fund investors seek to diversify their investments into bitcoin, Matrixport stated in its report, we can estimate potential inflows of $12-24 billion into the Bitcoin exchange-traded fund. While the market capitalisation of Grayscale Bitcoin Trust (GBTC) is presently only $17-18 billion, it reached a high of $44 billion. Thus, our estimate of $12-24 billion is relatively conservative.

BlackRock filed its application for a spot bitcoin ETF on June 15 and bitcoin rose to above $30,000 from $24,800 in the seven days after the filing. It was recently trading near $28,500.

15,000-strong U.S. registered investor advisor (RIA) community are overseeing nearly $5 trillion. This group holds huge potential, and even a modest 1% allocation recommendation for Bitcoin would usher in nearly $50 billion in inflows, the crypto firm added.

If Tether’s market capitalisation rises by $24 billion, acting as a proxy for potential ETF inflows, Bitcoin’s price would increase to $42,000, reflecting a conservative estimate. With a bigger influx of $50 billion (1% allocation from RIAs), Bitcoin could possibly rally to $56,000, Matrixport added.

The Securities and Exchange Commission delayed a number of ETF applications last month, saying it “finds it appropriate to designate a longer period within which to take action,” giving the regulator enough time to consider.