Decimal Digital founder Henry Robinson predicts a potential Bitcoin supply shock amid growing investment inflows into spot Bitcoin ETFs.
In exclusive comments to crypto.news, Robinson said Bitcoin ETFs are a game changer poised to revolutionize the industry by opening up unprecedented investment opportunities. According to him, these financial instruments will attract significant new investments in Bitcoin from various sectors, including pensions, endowments, insurance companies, sovereign wealth funds and trusts.
Robinson’s insights come after the US SEC approved several Bitcoin ETFs. This sparked a trading frenzy with reports of as much as $500 million being traded within the first 20 minutes.
Despite the excitement over early transactions, he offers a cautious view on Bitcoin’s availability to meet surging demand. There could soon be a potential “Bitcoin supply shock” that could lead to sharp price fluctuations.
Moreover, Robinson disputes the perceived value of ETFs, arguing that they do not offer significant advantages over self-storage, especially for long-term holders. He predicts that as Bitcoin adoption expands and self-custody gains traction among institutions, positions could bleed through fee emissions over the years, potentially reducing ETFs’ attractiveness.
After the SEC’s historic announcement yesterday, BTC reached $49,000 for the first time in nearly two years. However, the price quickly fell to around $46,000, reflecting Henry Robinson’s advance warning of a possible supply shock.