After the cryptocurrency market entered a frenzy after rumors falsely suggested that the U.S. Securities and Exchange Commission (SEC) had approved BlackRock’s spot Bitcoin exchange-traded fund (ETF) application, an analyst has now suggested that $BTC could reach $1 million and over $21 trillion in market capitalization.

As CryptoGlobe reported these rumors, which quickly spread from social media onto a Bloomberg Terminal, saw BTC surge to surpass $30,000 and quickly plunge after BlackRock noted the ETF was still under review, leading to over $100 million in liquidations in a single hour.

Analyst Alessandro Ottaviani, on the microblogging platform X (formerly known as Twitter), has now suggested that as Bitcoin’s market capitalization went up by more than $50 billion in minutes on the rumors, while estimating that roughly $500 million of capital entered the market, suggesting a ratio of 100:1, meaning that for every dollar that entered the market, BTC’s market capitalization rose $100.

The analyst cited a former BlackRock Director as saying that between $150 billion to $200 billion can be expected to enter the Bitcoin market in three years after a spot Bitcoin ETF is approved in the United States.

A spot Bitcoin ETF would provide a regulated and mainstream investment vehicle for investors to get exposure to Bitcoin without owning the cryptocurrency directly.

Using the same ratio, the analyst said that a $200 billion capital inflow would theoretically lead to a Bitcoin market cap of $21 trillion. In such a scenario, the price of Bitcoin would reach $1 million per coin.

He acknowledge, however, that as the price of the flagship cryptocurrency rose more holders would likely start selling their coins, which could potentially offset some of the price gains.

Despite the pump and dump Bitcoin’s price went through this week, BlackRock CEO Larry Fink has said that the rally revealed there’s “pent-up interest in crypto,” and noted that he believes the rally came as a “flight to quality, with all the issues around the Israeli war now, global terrorism.”

BlackRock’s CEO added that the firm has been “hearing from clients around the world about the need for crypto.” As CryptoGlobe reported, the founder and managing partner of SkyBridge Capital Anthony Scaramucci, recently revealed he believes Bitcoin’s market capitalization could reach $15 trillion, around 2,660% above its current $540 billion market capitalization.

Featured image via Unsplash.