Crypto Market Downturn Persists Amid SEC's Uncertainty on Bitcoin ETF Approvals
Summary:
The downturn in the cryptocurrency market continues as participants anxiously await the U.S. Securities and Exchange Commission's (SEC) decision on spot Bitcoin ETF applications due November 17. The market had previously buoyed on hope for a Bitcoin spot ETF approval, pushing Bitcoin prices to an 18-month high. But this optimism is fading, coinciding with a decline in the crypto market and the SEC's delays on various ETF applications. As a result, traders appear to be locking in profits at high prices amid these uncertainties, leading to a steep liquidation of long positions in the crypto market.
The downturn in the crypto market persists as partakers contemplate the possible aftermath of a delay in the U.S. Securities and Exchange Commission's (SEC) decision regarding Bitcoin ETF applications. The anxiety rises as the market concentrates on the SEC's decisions about Bitcoin (BTC) spot ETF applications due on November 17. The cryptocurrency market's one-day chart shows this inclination, courtesy of Coin360.
Previously, the market experienced a surge of optimism over the possible approval of a Bitcoin spot ETF in November, which significantly boosted the Bitcoin price to a peak not seen in 18 months, crossing $38,000. However, this optimistic trend is now showing signs of subsiding, evident by this week's almost 2% drop in Bitcoin prices.
The market was buzzing with anticipation for positive ETF news this week. Yet, a delay appears more likely after the SEC postponed Hashdex's Bitcoin ETF conversion application on November 15. Surprisingly, despite BlackRock's claim no valid reasons exist for the SEC to withhold crypto spot ETF approval, the regulatory body seems prepared to delay.
On November 15, the SEC also put off deciding on Grayscale’s Ether futures ETF. Grayscale's submitted Form 19b-4 is being seen as a potential regulatory loophole by some analysts.
The decline in the cryptocurrency market coincides with the expected SEC review of several pending spot Bitcoin ETF applications. Crucially, the SEC must reach a decision on Hashdex and Global X ETFs applications by November 17, and Franklin Templeton's Bitcoin ETF application by November 21. If the agency fails to meet these deadlines, it will be pushed back until 2024.
The market expects another delay, shared James Edwards, a crypto analyst at Australian fintech firm Finder. He pointed towards a fake BlackRock XRP trust filing, which led to extreme price fluctuation in the XRP market and prompted an investigation request to be presented to the U.S. Department of Justice. Edwards suggests this incident may reinforce the SEC's distrust towards the sector, thereby affecting the launch of a spot Bitcoin ETF in the U.S.
In the face of a possible long wait ahead, traders seem to be securing profits at the existing multi-month high prices in the cryptocurrency market. Cryptocurrency liquidations have also contributed to the market's downward trend. In the past day, over $161.4 million in long positions in the crypto market has been liquidated, including a $54 million wipeout in the last four hours.
As we proceed, the digital currency market will have to overcome multiple challenges, molded by the complex interplay of financial and regulatory elements, which will outline its journey for the foreseeable future.
Please note, this news piece does not offer any investment advice or recommendations. Each investment decision carries associated risks, hence readers are advised to conduct their own research before making any investment decisions.
Published At
11/17/2023 5:09:15 PM
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