Qatari Wealth Fund Unlikely to Invest in Bitcoin Amid Market Uncertainty and US Regulatory Pressures
Summary:
The Qatari sovereign wealth fund is unlikely to invest in Bitcoin due to uncertainty in the market, according to a local finance executive. Bitcoin ETFs have seen an 80% decrease in net inflows, while the US SEC faces pressure from two senators to halt further crypto ETF approvals. Despite rumors, the Qatar Investment Authority seems to have no plans for Bitcoin investment due to its diversified strategy. Conversely, a drop in net inflow into US-based Bitcoin ETFs is attributed to regulatory uncertainties and market volatility. There is opposition from the crypto community to senators advocating for a stop to crypto ETF approvals.
Concerning speculations about the Qatari sovereign wealth fund investing in Bitcoin (BTC), a local financial executive has refuted this potential move to Cointelegraph. The uncertainty currently enveloping the market has led to an 80% dip in net inflows for Bitcoin exchange-traded funds. Additionally, the Securities and Exchange Commission (SEC) is being pressured by two US senators to steer clear from approving further crypto ETFs. It appears that due to the Qatari Investment Authority's diversified investment approach, Bitcoin inclusion in its holdings is unlikely. Shadi Qishta, the CFO of Kown Capital, states that despite Bitcoin's global relevance, its adoption in Qatar is quite low.
In the wake of the successful launch of spot Bitcoin ETFs in the US, anticipations of Qatari involvement in Bitcoin have risen. These funds have piqued institutional interest prompting wealth manager Cetera to approve the integration of four spot BTC ETFs in clients' portfolios. However, the net inflow into spot Bitcoin (BTC) ETFs in the US drooped to a skimpy $132 million on March 14, which was their lowest yet in the last eight trading days and an 80% reduction compared to March 13.
This drop was the second one in a row, following the $684 million inflow on Wednesday, which was a 38.3% drop from March 12. The inflows on Tuesday hit a record-breaking $1.05 billion in a single day. As of March 14, the total inflow into the ETFs stood at $390 million. Meanwhile, the Grayscale Bitcoin Trust ETF recorded another $257 million in outflows, totaling net inflows to $132 million. Even with significant outflows, GBTC net flows remained positive on Thursday.
Experts believe that the current market instability, regulatory ambiguities, and broader economic factors are making investors cautious. The current downturn is also accredited to the upcoming meeting of the Federal Open Market Committee, which might clarify the Federal Reserve's stance on future interest rate adjustments.
In a letter dated March 11, Democrat senators Jack Reed and Laphonza Butler have asked Gary Gensler to halt further crypto ETF approvals as it presents massive risks to retail investors. They warn that continued approval of crypto ETFs by the SEC could expose investors to highly fraudulent and manipulative markets. Simultaneously, there are hopes for other altcoins following the same route with eight proposed Ether ETF applications waiting for SEC approval.
Many members of the crypto community fiercely opposed the senators' opposition. According to Paul Grewal, the Chief Legal Officer of XCoinbase, the senators' letter contained numerous inaccuracies. He argues that the market for several cryptocurrencies indicates quality metrics that surpass even the most prominent traded equities. Grewal points out that as of 2020, the 33-member organization COPA encourages cryptocurrency adoption and advancement and seeks to overcome patents as a hindrance to growth and innovation.
Published At
3/15/2024 11:03:31 PM
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