Crypto Market Faces Uncertainty Amid Potential SEC Delay of Bitcoin ETF Applications
Summary:
Cryptocurrency markets face downturns amidst uncertainty surrounding the U.S. Securities and Exchange Commission's (SEC) potential delay of spot Bitcoin ETF applications. Stakeholders, such as Australian Fintech's analyst, express concerns over a possible delay. Major cryptocurrencies have seen a decline, triggering a string of liquidations across the derivative market. Despite the market setback, some altcoins have shown strong performance. The cryptocurrency market's short-term performance will be shaped by various economic and regulatory influences.
Cryptocurrency markets continue to lean towards a downturn as stakeholders evaluate potential repercussions if the Securities and Exchange Commission (SEC) elects to postpone predicaments tied to spot Bitcoin ETF applications. The 30-day diagram from Coin360 illustrates a fall in the value of XRP and altcoins after a deceptive ETF filing, a situation coinciding with the week the SEC is due to examine pending bitcoin ETF applications.
Significantly, the authority is obliged to make a decision regarding ETF applications from Hashdex and Global X by the 17th of November. Franklin Templeton's Bitcoin ETF application also awaits the commission's verdict due by 21st November. Failure to meet these deadlines pushes matters to 2024.
The potential for another delay is perceived by market players, as stated by cryptocurrency analyst James Edwards of Australian Fintech firm Finder. Edwards highlighted a false BlackRock XRP trust filing which has led to notable fluctuations in the XRP market and triggered an investigation from the United States Department of Justice. According to Edwards, this incident underlines the SEC's persisting qualms regarding price manipulation in the cryptocurrency domain, potentially damaging the chances of a spot Bitcoin ETF launch in the US. As a response to these uncertainties, traders may be safeguarding profits at currently high levels in the market to mitigate the prolonged waiting period.
Amid widespread anticipation for a Bitcoin ETF approval that kickstarted November and propelled Bitcoin prices to 18-month highs above $38,000, an easing sentiment is now discernible due to the likely postponement. The Bitcoin price slipped by 4% on 16th November, indicating lower liquidity at elevated levels.
The 15th November saw the SEC opt to defer Hashdex's application for a spot Bitcoin ETF conversion. Contrary to BlackRock's assertion that there's no valid basis for the SEC to reject a cryptocurrency spot ETF, the commission appears more likely to impose further delays, as exemplified on the same day when it prolonged a decision on Grayscale's Ether futures ETF.
The drop in major cryptocurrencies has sparked a cascade of liquidations in the derivative market amounting to over $160 million in long positions liquidated within the past 24 hours, with $144.3 million eliminated in the prior 12 hours. The market value of cryptocurrencies suffers when long derivative positions are liquidated in the absence of buying pressures from trading volume.
Despite these downward trends in the crypto market, certain altcoins have outperformed others. For the near future, fluctuations in the cryptocurrency market will be primarily driven by diverse challenges, economic factors, and regulatory influences.
Please note, this article does not constitute investment advice. Investments carry risk and therefore readers are advised to conduct their own research before making any decisions.
Published At
11/16/2023 8:29:37 PM
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