Bitcoin rebounded Thursday above $44,000, as enduring optimism regarding the prospect of an imminent spot Bitcoin ETF approval from the Securities and Exchange Commission offset fears stirred yesterday by an ominous report published on the subject.
At writing, BTC sits at $44,032, up 4.2% from yesterday’s lows.
Digital asset manager Matrixport yesterday predicted that the SEC would likely reject all Bitcoin ETF proposals this month, and instead begin approving such applications in the spring. Off the news, BTC immediately nosedived a sharp 7%.
But analysts who have closely tracked the SEC’s dealings with Bitcoin ETF applicants including BlackRock, Fidelity, and Grayscale denounced the report as lacking substance, and doubled down on their assessment that the first Bitcoin ETF is most likely to be approved in the next week.
It appears the market was assuaged by such reassurances. BTC has now almost completely recovered the losses incurred yesterday.
For better or worse, the price movement indicates that BTC’s standing is, at least for the moment, deeply interconnected with the fortunes of a spot Bitcoin ETF.
And for good reason: the financial product, if approved, would allow traditional finance institutions and investors to gain exposure to Bitcoin without holding any cryptocurrency. Analysts have estimated that the instrument could expose $14 trillion worth of assets to Bitcoin.
Eric Risley, managing partner of digital assets advisory firm Architect Partners, previously told Decrypt that the approval of a Bitcoin ETF would constitute a historic game changer and the “legitimization of the [Bitcoin] asset class.”
Hopes related to the approval of a spot Bitcoin ETF have carried Bitcoin far in its almost three-month-long rally. Since October, the world’s top cryptocurrency has climbed a remarkable 64.77% in value, up from $26,750.
The views and opinions expressed by the author are for informational purposes only and do not constitute financial, investment, or other advice.
