The prospect of an approved Bitcoin spot exchange-traded fund (ETF) has ignited renewed optimism and triggered what industry experts are calling “The Great Accumulation Race” for Bitcoin. Major players like Fidelity, Invesco, Wisdom Tree, and Valkyrie have joined BlackRock in applying for a Bitcoin spot ETF with the United States Securities Exchange Commission. This wave of interest is believed to be the driving force behind Bitcoin’s recent 19% price surge to $30,240 since June 16. As institutions and retail investors scramble to secure their share of the limited Bitcoin supply, the dynamics of the market are undergoing a significant shift.

Institutions and Retail Investors Embrace “The Great Accumulation”:

Cameron Winklevoss, co-founder of cryptocurrency exchange Gemini, has proclaimed the start of “The Great Accumulation” phase for Bitcoin, involving both institutional and retail investors. Winklevoss compared the current situation to buying Bitcoin before it hits the public market, akin to a pre-Initial Public Offering purchase. He emphasized that the window for purchasing Bitcoin is closing rapidly, signaling the growing interest from institutional players.

Institutional Demand Pushes Retail Investors Aside:

MicroStrategy Executive Chairman Michael Saylor echoed the sentiment, suggesting that the increasing institutional demand for Bitcoin may soon overshadow retail investors. Saylor cautioned that the time to capitalize on front-running institutional demand is diminishing. This shift in dynamics could lead to a highly illiquid market as retail investors may be reluctant to sell their holdings to Wall Street, according to Bitcoin investor Anthony Pompliano.

Bitcoin Price and Market Sentiment:

Currently trading at $30,240, Bitcoin has experienced a significant price surge due to the recent ETF filings. The Crypto Fear and Greed index has climbed from 49 (Neutral) to 65 (Greed) within just two days, indicating the growing market sentiment. Pompliano highlighted that Bitcoin achieved nearly a trillion-dollar market cap with minimal institutional participation, emphasizing the potential impact of Wall Street’s entry into the market.

The Inelastic Nature of Bitcoin and ETF Approval Outlook:

Bitcoin analyst Dylan LeClair, founder of 21st Paradigm, noted that Bitcoin’s price has become highly inelastic, particularly in response to the recent ETF filings. This development has acted as a catalyst for significant inflows into the market. However, LeClair predicts that the SEC is unlikely to approve any ETF applications until January or February 2024 at the earliest.

The excitement surrounding Bitcoin ETF applications has triggered “The Great Accumulation Race” among institutions and retail investors. As major players apply for ETFs, Bitcoin’s price has surged, reflecting growing market optimism. Retail investors have a head start but face increasing competition from institutional demand. While the market becomes more inelastic and highly illiquid, the approval of ETF applications may still be several months away. As the race for Bitcoin intensifies, market participants eagerly anticipate the next developments in this evolving landscape.