Arthur Hayes Believes a Bitcoin ETF Could Draw Billions of Dollars from TradFi

Arthur Hayes, former CEO of BitMEX and now chief investment officer at Maelstrom's office, shared an interesting view on the Bitcoin market. In his article published on Tuesday, Hayes stated that exchange-traded funds (ETFs) for Bitcoin, particularly those based on the spot market, could attract billions of dollars in capital from broader financial markets. According to him, factors such as market inefficiencies and Bitcoin's disconnected nature from traditional assets make it attractive.

Bitcoin Spot ETFs May Trigger Continued Arbitrage

Hayes emphasized that Bitcoin is a global market with price discovery primarily occurring at Binance, which he alleged is based in Abu Dhabi. With the existence of spot Bitcoin ETFs, he predicts sustainable and predictable arbitrage opportunities will emerge, especially because of price differences between benchmark prices in the US and elsewhere in the world.

“My expectation is that billions of dollars will flow into less liquid exchanges in a time period of about an hour, and this will create interesting arbitrage opportunities,” Hayes said.

Also read: Buy Bitcoin vs Spot Bitcoin ETF, Which is More Profitable?

Potential Growth in ETF-Based Funding

Furthermore, Hayes predicts the emergence of spot ETF products in major Asian markets such as Hong Kong, which will serve capital flows from China. The presence of these highly regulated exchanges, along with local crypto exchanges, could add to market inefficiencies and open up more opportunities for profit.

Hayes also highlighted the growth potential of the ETF-based funding sector. He mentioned that banks might open fiat lending services collateralized by Bitcoin ETF holdings, taking advantage of the spread and influencing Bitcoin interest rates, which in turn would create more imbalances in the market.

Also Read:

Jupirter Token (JUP) Release Date and Free Airdrop Schedule

Tether USDT Accused of being a Money Laundering Tool in Southeast Asia

Tether Denies UN Accusations Regarding USDT

HashKey Group Raises $100 Million in Funding at $1 Billion Valuation

DISCLAIMER:  This article is informational in nature and is not an offer or invitation to sell or buy any crypto assets. Trading crypto assets is a high-risk activity. Crypto asset prices are volatile, where prices can change significantly from time to time and Bittime is not responsible for changes in fluctuations in crypto asset exchange rates.