Bitcoin's Value Predicted to Undergo Adjustment Post Spot ETF Approvals
Summary:
Bitcoin's value is predicted to adjust after Bitcoin exchange-traded funds (ETFs) get approved, due to optimistic institutional buying. Industry analysts believe this could trigger a sell-off event, though a significant correction isn't guaranteed. Regardless of signs pointing to a correction, the cryptocurrency's unpredictable nature, stronger market fundamentals, and current momentum signal that a pullback, if any, would be shallow. The industry anticipates a window for potential ETF approval between January 5 and 10, 2024, which could refocus mainstream attention onto the cryptocurrency market.
Bitcoin's value is expected to logically undergo adjustment once the Bitcoin exchange-traded funds (ETFs) gain approval, although industry observers also acknowledge the cryptocurrency's unpredictability. In recent times, Bitcoin has experienced considerable momentum, with a leap in March due to banking volatility, another surge in June when BlackRock registered for a Bitcoin ETF, and once more in October, as optimism increased around Bitcoin ETF approvals. On December 3, Bitcoin surpassed the $40,000 mark, its highest value in 19 months.
James Edwards, a cryptocurrency specialist at Finder, opines that the sanctioning of a Bitcoin ETF would logically set off a sell-off event. The notion that widespread institutional buying will occur immediately is overly optimistic, predicts Edwards, underscoring that it may take months or even years to witness genuinely innovative inflows.
Nonetheless, some, including Edwards, argue that an extensive correction isn't absolutely guaranteed. Ryan McMillin, the chief investment officer of Merkle Tree Capital acknowledges the growing risk of a correction after Bitcoin's continuous rise over 100 days. However, he also stresses that Bitcoin ETFs are the most eagerly awaited ETF launch to date and any sell-off will be quickly snapped up.
Similarly, CK Zheng, who co-founded the cryptocurrency investment firm ZX Squared Capital, predicts a "shallow" market pullback. He attributes this confidence to excellent market fundamentals, including next year's BTC halving, extensive money creation by worldwide central banks and the persistent geopolitical instability globally.
On the outlook for December, experts are not predicting any significant slump for Bitcoin. Edwards indicates there are early signals that institutional investors are already speculating on these ETF approvals, with Bitcoin futures ETFs seeing increased activity recently. Meanwhile, legal expert Joe Carlasare similarly sees a slim possibility of a major Bitcoin correction prior to ETF approval.
The wider industry awaits a significant window for potential ETF approval, targeted for between January 5 and 10, 2024. In relation, a massive Bitcoin ETF approval could refocus mainstream attention on the cryptocurrency market, according to Henrik Andersson, the chief investment officer of Apollo Capital.
Published At
12/4/2023 6:17:29 AM
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