According to a recent report from Glassnode, a company specialising in blockchain data, there is significant unmet investor demand for a bitcoin spot exchange-traded fund (ETF).

Glassnode estimates that up to $70bn of new capital could flow into the bitcoin market once a spot ETF fund is approved. This forecast is based on the assumption that 10 per cent of funds currently invested in the underlying stock and bond funds will move into bitcoin ETFs, as well as 5 per cent of capital directed into gold ETFs.

The report notes a shrinking supply of bitcoins to trade to meet this potential surge in demand. According to Glassnode, the share of short-term investors holding bitcoins recently hit a multi-year low. At the same time, the share of long-term bitcoin holders hit a record high of more than 76 per cent in October.

U.S. regulators have yet to approve a spot bitcoin ETF. Its approval could significantly increase access and demand for bitcoin from institutional investors.

According to Glassnode, a spot bitcoin ETF could have an impact comparable to the first U.S. gold ETF launched in 2003. In the decade that followed, gold prices rose more than 400 per cent on the back of increased investment demand.