Tomorrow 10th of January is the final deadline for the SEC approval of the BTC ETF file from the ARK 21Shares partnership.
We do not know the result although the bets are around 90% in the favour of the approval after SEC delayed all the applications for a lot of times but now the pressure from the big investment funds seems to be so high that the approval seems inevitable, a good sign being the Gary Gensler Twitter thread from yesterday on investing in crypto which can be assumed that he advises people who will be interested in crypto to be careful on the inevitable risks and scams.
The list of the applicants for a BTC ETF is full with grand names with trillions of dollars in assets:
What will be the effect of the approval on the BTC price is debatable, some estimate this is already priced in and this will be a “Buy the rumour and sell the news event”, others think this will bring more money to the crypto world and more credibility and this will surely have a positive influence on price.
Even Chat GPT thinks the approval could have a significant effect on BTC price due to increased demand from people who did not had acces or knowledge or trust to buy it from exchanges, centralised or decentralised.
We have to consider here several other aspects:
Although this will be a synthetic product (the clients will held shares in the ETF, not actual bitcoin) the funds will need to posses real Bitcoins in custody so the demand for the coin should increase at least at the time of the creation of the ETF (of course funds would love to buy BTC cheaper).
The approval of the first spot BTC ETF will offer more legitimacy to BTC and crypto in general and will make retail people who are now more reluctant to invest more comfortable with this new asset but will also make the Wall Street funds and traders more prone to start trading this newer class of assets who can offer much more gains than the assets they are trading now, especially with the infrastructure they held (algorithms powered by AI and staff).
The Bitcoin cycles: these are dependant on the halving events, each four years the rewards for the miners are cut in half, the next one being estimated to take place this April. History doesn’t have to repeat especially with the possible spot BTC ETF approval but in the previous cycles the BTC prices have fallen after halving followed by a huge rally afterwards (this is not financial advise).
Let’s see what will happen in the next days and months but is clear that crypto and blockchain will become more mainstream and the adoption will increase, this could be the technology which will change the world, the Internet 2.0 and we are witnessing its creation and rise.
