Wall Street players are now backing crypto as institutional investors show support for bitcoin ETFs. Yahoo Finance crypto reporter David Hollerith checks out bitcoin's year-to-date performance and the outlook for bitcoin ETF approval.
Video Transcript
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AKIKO FUJITA: Crypto prices lower today but momentum has been strong this year. And now some of the biggest names in finance are making new bets on cryptocurrencies adding competition and momentum to the space. Yahoo Finance's David Hollerith has more on that story. And David, nothing like a boost of confidence from Wall Street to get investors bullish on crypto again.
DAVID HOLLERITH: Akiko, the big finance player moves that we've seen in the last two weeks obviously started with BlackRock filing an ETF. We also saw ETX markets begin trading. And they're backed by Fidelity Charles Schwab and Citadel Securities. And that's a new crypto exchange that doesn't interact with individuals but serves more like a traditional exchange.
And then we have Deutsche Bank also applying to custody crypto assets. And outside of BlackRock, a lot of these moves were previously telegraphed as far back as a year. But obviously, this came at a really good time, I guess you would say for the space, just given that a lot of this year so far the story has been regulatory enforcements in the US leading to lawsuits. And that's still a lot of what we're looking at to determine where things are going.
Regulation, of course, in the US is a really big deal. But we've seen obviously-- the Bitcoin price has surged a lot and then the total crypto market cap has followed along with that. And we've seen even just higher inflows into Bitcoin associated exchange traded products. So there's a lot of enthusiasm about this. Most of it actually was previously reported but I think that it highlights-- it's a reminder that cryptocurrency hasn't gone away as much as it might seem sometimes.
And we see earlier this month, in fact, the SEC filing charges against the two largest crypto exchanges in the world.
AKIKO FUJITA: And David, to that point, at least up until this point when you take into account the massive run that we've seen in the price of Bitcoin up what about 80% year to date. It hasn't yet had a massive impact but I guess you can make the argument that it's coming off a very depressed level after the implosion of FTX. But what do you think are the key things that investors need to watch for when they're trying to figure out where Bitcoin, where crypto is headed in the second half?
DAVID HOLLERITH: Yeah. Always a good question. I think it's fair to think about it this way, which is that regulation has really dominated cryptocurrency asset prices. Maybe Bitcoin the least but still Bitcoin has sagged on bad regulatory news. So regulation is still going to be a major focus. But as things get cleared up, at least I think with the BlackRock and ETX announcements, there's a signal that US businesses or financial institutions, I should say, are still interested in getting involved in the space.
And I think that brushes aside some of it. That being said, from what I've heard from crypto hopefuls in Washington, it sounds like there are two bills that are getting ready to be voted on in the House in July. And I've heard optimistically that one of those two bills could be passed in the House by the end of the year. There's a lot less optimism for what could happen in the Senate.
And then that being said, the most important lawsuit as far as the ETF goes is the Grayscale lawsuit. Grayscale is suing the SEC for not approving its spot Bitcoin ETF or approving a conversion of its existing product. So the verdict for that case comes out at the beginning of September, and that's going to be really important. And we don't have the exact information, we don't know, but it'd be hard to imagine that the SEC would even consider approving an ETF before that verdict is reached.
AKIKO FUJITA: I know you'll be following those developments closely, David Hollerith, thank you.