BlackRock CEO Larry Fink has attributed the recent rally in Bitcoin (BTC)‘s price to the increasing interest and demand for cryptocurrencies.
Fink made these remarks in response to a false news report about the approval of a spot ETF, which temporarily triggered a surge in Bitcoin’s value.
While Fink refrained from commenting on BlackRock’s own application for a spot Bitcoin ETF, he acknowledged that clients from around the world have been expressing the need for crypto.
“Some of this rally is way beyond the rumor. I think the rally today is about a flight to quality, with all the issues around the Israeli war now, global terrorism,” Fink said in an interview on Fox Business.
“I think there’s more people running into a flight to quality, whether that is in Treasuries, gold or crypto, depending on how you think of it. And I believe crypto will play that type of role, as a flight to quality.”
On Monday, Bitcoin’s price soared to nearly $30,000 following a post that falsely claimed the BlackRock ETF had received approval from the Securities and Exchange Commission (SEC).
Although Bitcoin experienced a decline after the false report was debunked, it managed to retain some gains.
At the time of writing, the largest cryptocurrency by market capitalization was trading at $28,200, up 1% over the past day, according to CoinGecko.
It has recorded a 7.4% increase over the past month and an impressive 47.4% gain over the past year, driven in part by the anticipation surrounding the approval of a spot ETF.
Analysts Believe SEC Will Have to Greenlight Bitcoin ETF
In September, JPMorgan analysts led by Nikolaos Panigirtzoglou said that the SEC will likely be forced to approve multiple spot BTC ETF applications following the Grayscale victory.
As reported, a US court has ruled in favor of Ripple in the ongoing lawsuit brought by the SEC, claiming that selling XRP on exchanges in itself does not constitute an investment contract.
The ruling, issued by the District Court for the Southern District of New York, stated that the “offer and sale of XRP on digital asset exchanges did not amount to offers and sales of investment contracts.”
However, the federal judge also ruled that XRP is a security when sold to institutional investors, as it met the conditions set in the Howey Test.
The JPMorgan analysts wrote that Grayscale’s win implies that the SEC would have to retroactively withdraw its previous approval of futures-based Bitcoin ETFs in order to defend its denial of Grayscale’s proposal of converting its Bitcoin trust into an ETF.
However, such a move would be “very disruptive and embarrassing for the SEC” and appears unlikely, the analysts said, adding:
“It looks more likely that the SEC would be forced to approve the spot bitcoin ETF applications that are still pending from several asset managers, including that from Grayscale.”
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