SEC's Bitcoin ETF Approval Sparks Market Volatility and Future Predictions
Summary:
The US Securities and Exchange Commission's (SEC) approval of Bitcoin ETF applications on January 10 led to market volatility. While some predict a potential surge for Bitcoin to $50,000, there is speculation about its limited price increase potential. This follows the SEC's social account being compromised and about $1 billion in open interest purged from Bitcoin's futures market, further fueling market uncertainties. Despite these events, Bitcoin's returns overshadowed gold's in 2023, and this upward trend continues into 2024.
The US Securities and Exchange Commission (SEC) green lit Bitcoin ETF applications on January 10, causing price fluctuations similar to those seen after an erroneous approval announcement. Early predictions suggesting approval led to a Bitcoin price surge to $46,437. Sentiment saw a further uplift when the Cboe green-lighted listings. Over the past few weeks, speculations of a Bitcoin ETF approval have buoyed the market, but traders remain divided over Bitcoin's ability to cross the $48,000 threshold.
An unexpected story of the SEC's social account being compromised coincided with approximately $1 billion of open interest being stripped from the Bitcoin futures market. This caused discontent amongst market players and Bitcoin enthusiasts who felt the error bore resemblance to a 'pump and dump' scenario. This substantial loss of open interest may explain the more subdued market activity seen on January 10. Accusations of the SEC violating market manipulation regulations are now surfacing, prompting U.S. senators to request a briefing from SEC Chair, Gary Gensler, by January 15.
On January 10, the SEC website unveiled three large Bitcoin sell orders placed between $46,100 and $48,000, fuelling speculation about Bitcoin's limited potential for price increase. Nonetheless, some market analysts are predicting a possible surge to $50,000. So far, Bitcoin's returns for 2023 already dwarf that of Gold's, and this upward trend appears to be continuing into 2024. Michael Saylor, the Chairman of MicroStrategy and a prominent Bitcoin supporter, opines that a Bitcoin ETF could be transformative for the finance sector, on par with the introduction of the S&P 500.
Readers are cautioned that this article does not constitute financial advice and all investing decisions should be informed by personal research. Any trading activity involves inherent risk.
Published At
1/11/2024 12:34:33 AM
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