The price of bitcoin could rise to between $42,000 and $56,000 if BlackRock's spot bitcoin ETF is approved by the Securities and Exchange Commission, according to digital assets financial services platform Matrixport. Utilizing its analysis of 15,000 U.S. registered investment advisors, Matrixport projected some $12 billion to $24 billion worth of inflows could come into such an ETF.

“If Tether’s market cap increases by $24 billion, acting as a proxy for potential ETF inflows, bitcoin’s price would rise to $42,000, representing a conservative estimate,” Matrixport noted. “With a larger influx of $50 billion, bitcoin could potentially rally to $56,000.”

RIAs oversee around $5 trillion, according to Matrixport, arguing a modest 1% allocation recommendation from the group could produce the up to $50 billion of inflows. “Drawing a parallel with precious metals ETFs, estimated at approximately $120 billion in market cap, and assuming that between 10-20% of precious metal ETF investors look at a bitcoin ETF to diversify their monetary debasement and inflation hedges, we could witness a sizeable $12-24 billion worth of inflows into the bitcoin ETF,” it said.

Fake news and additional delays

BlackRock, among other institutions, submitted its application in June. However, additional proceedings were instituted by the SEC last month to determine the approval or disapproval of spot bitcoin ETFs from major players, including BlackRock, as well as Invesco, Valkyrie and Fidelity, in an apparent additional delay that could last at least another month.

A wild trading day on Monday saw bitcoin's price spike 5% to almost $30,000 after a false report regarding approval of BlackRock's spot ETF circulated on social media before being debunked.

Earlier this month, former BlackRock executive Martin Bednall said the SEC will likely approve all spot bitcoin ETF applications at the same time.