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Bitcoin Spot ETF: A New Engine for the Crypto Market Set to Ignite the Bull Run
Bitcoin Spot ETF: A New Hope for the Crypto Market
After a long bear market, the market urgently needs a new breakthrough to boost overall sentiment. Just like when a certain Bitcoin trust fund received regulatory approval in 2020, igniting market enthusiasm, the most likely candidate to play this role now is the highly anticipated Bitcoin Spot ETF.
Despite the cautious attitude of U.S. regulators towards the Bitcoin Spot ETF and the repeated delays in approval, the market remains optimistic about its eventual approval. According to current predictions, the probability of the Bitcoin Spot ETF being approved within this year is 75%, with the probability of approval reaching 95% by the end of 2024 at the latest. The approval of the Bitcoin Spot ETF is expected to become an important catalyst to reverse the market downturn and trigger the next bull market.
Overview of Bitcoin Spot ETF and Its Appeal
A Bitcoin Spot ETF is a fund that allows investors to buy and sell real Bitcoin at the current market price. The fund directly purchases, sells, and holds actual Bitcoin, enabling investors to participate in the market without having to manage their own Bitcoin wallets.
Bitcoin Spot ETF has multiple advantages:
Lower risk: Invest at the actual Bitcoin price, investors hold real Bitcoin during the contract period.
Flexible trading: Can be bought and sold on the stock exchange, allowing for flexible operations like stocks.
Compliant Investment: Providing Bitcoin investment tools that meet regulatory requirements for traditional financial institutions.
Expand market size: It is expected to attract more investors into the crypto market.
Direct participation: Closer to the real Bitcoin market than futures ETFs.
Meet institutional needs: Provide convenient access for traditional financial institutions to enter the crypto market.
High transparency: Listed on the exchange, subject to strict regulation, more reliable than some crypto exchanges.
Bitcoin Spot ETF Approval Prospects
Although U.S. regulators have not approved a Bitcoin Spot ETF for many years, there has been a recent development. One of the world's largest asset management companies has submitted an application and proposed to select a large encryption currency exchange as the custodian. This company's past ETF application success rate is extremely high, raising optimistic expectations in the market for this application.
As a result, multiple institutions have also resubmitted applications. As of August, eight well-known institutions have applied for a Bitcoin Spot ETF. This intense wave of applications may indicate that the 10-year approval stalemate for the Bitcoin Spot ETF in the United States is about to be broken.
Potential Impact of Bitcoin Spot ETF
Once approved, the Bitcoin Spot ETF will have a profound impact on the crypto market:
Large exchanges benefit: As the custodian and data provider for ETFs, some exchanges will receive substantial profits.
Could become the "engine" of a bull market: providing a safe channel for large amounts of traditional financial capital to enter the crypto market, which is expected to stimulate market strength.
Promote the mainstreaming of encryption assets: provide convenient access for institutional investors to participate in the crypto market, and improve awareness and popularity.
Enhance market transparency: Supervisory sharing agreements will increase regulatory transparency and improve market credibility.
Promote regulatory improvement: helps to align the crypto market with traditional financial regulation, promoting more reasonable policy formulation.
Conclusion
Although U.S. regulators have not made a final decision, logically, since they have allowed high-risk Bitcoin futures ETFs to be listed, there is no reason to refuse spot ETFs. The new applications have joined the oversight sharing agreement, addressing previous regulatory transparency issues. Reports indicate that relevant parties are preparing a regulatory cooperation agreement. Therefore, the approval of Bitcoin spot ETFs in the U.S. seems to be just a matter of time, which will bring new development opportunities to the crypto market.