Bitcoin ETF Countdown is ON

If you thought the new year would bring less ETFs debates, you might want to reconsider…

Amidst recent developments and news surrounding Bitcoin ETFs, not only are markets all over the place, but analysts’ opinions seem to be contradicting one another.

From JPMorgan and Bloomberg Intelligence analysts, to Matrixport and BitMex members… ETFs have certainly gained major attention over the past month.

While markets appear to have fully embraced the idea that the SEC will approve a spot Bitcoin ETF, we might want to stop for a second and think to ourselves:

? What if ETFs do not get approved?

How would markets react? How would that affect the price of Bitcoin specifically?

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SEC To Deny Spot BTC Approval Again?

The growing anticipation within the crypto community for the approval of a Bitcoin ETF has had a tremendous effect on the industry, which is still recovering from the 2022 collapse.

While the official deadline for the SEC’s decision still remains unclear, Bloomberg analysts have said a launch now has a 90% chance of happening by January 10.

Opinions on what a Bitcoin ETF will do for the crypto market range from a monumental influx of Wall Street money to nothing out of the ordinary at all – depending on whom you ask.

The SEC could technically deny the product, the reasoning being that Bitcoin is largely global and decentralised, which makes it more vulnerable to market manipulation.

The scenarios leading to a rejection of Bitcoin ETFs proposals are diverse, but considered unlikely by market experts.

Did you know? According to Bitwise, only 39% of financial advisers believe a Bitcoin ETF will be approved in 2024.

Anti-ETFs Gang

Matrixport experts have been extremely bullish on ETFs.

“SEC Chair Gensler is not embracing crypto in the US, and it might even be a very long shot to expect that he would vote to approve Bitcoin Spot ETFs”, head of research Markus Thielen wrote in a report published by Matrixport last week.

The report, which sent the markets in severe panic mode, was not based on any insider information, just pure speculation.

However, Matrixport are not the only players in the market who are expecting a rejection of the product.

BitMex ex-CEO, Arthur Hayes, has warned of potential 40% Bitcoin crash in March.

According to Hayes, “if ETFs managed by TradFi asset managers are too successful, they will completely destroy Bitcoin”.

Additionally, analyst Nate Geraci raised concerns about the possibility of the product failing to receive approval.

The analyst publicly stated his opinion on X (formerly Twitter), saying: “If spot bitcoin ETF not approved in January, might be one of bigger rug pulls in crypto history…”.

Geraci was referring to the concerns with regulatory compliance that the SEC has historically taken as its approach towards spot Bitcoin ETFs.

Not only this, but Better Markets submitted a comment letter last week, urging the SEC to decline the applications.

The links between Better Markets, SEC Chair Gary Gensler, and Senator Elizabeth Warren certainly did not go unnoticed.

Dennis M. Kelleher, Co-Founder, President, and CEO,?issued?the following statement on the filing:

“The approval of spot bitcoin ETPs would be a historic mistake almost certainly leading to massive investor harm. The immense and unrelenting fraud and manipulation in the bitcoin market means that approving these products would expose millions of American investors and retirees to the very harms that the SEC exists to prevent.”

Worst Case Scenario

Now comes the highly asked question: what will happen to BTC if ETFs do not get approved?

1.???? There’s a 5% chance that the SEC rejects ETFs.

2.???? According to a Bloomberg analyst, the likelihood of the product being rejected has decreased from 10% to just 5%.

Potential reasons include:

• Ark withdrawing with March assurances.
• SEC presenting new objections or disregarding court decisions.
• Intervention from the Biden administration.

Bitcoin slipped by 0.16% on Sunday, ending the session at $44,055.

• It is to be noted that BTC held onto the $44,000 handle amidst anticipation of the SEC’s approval for the first batch of BTC-spot ETFs.
• CryptoQuant anticipates a potential decline in Bitcoin to around $32,000 next month.
• CryptoQuant is not alone in predicting a decline. QCP Capital, a Singapore-based crypto trading firm, said on Telegram last month that initial demand for the ETFs could be lower than expected, setting the stage for a classic sell-the-news scenario.
• BTC held above the 50-day and 200-day EMAs, sending bullish price signals.
• A BTC breakout from the $44,690 resistance level would give the bulls a run at the $46,020 resistance level.
• However, a break below the $42,968 support level would bring the 50-day EMA into play.

While the final decision still remains uncertain, we can definitely expect volatility in the upcoming days.

*This article is for informational purposes only and not intended as investment or financial advice. It contains opinions and speculations that are subject to change without notice. The author and publisher disclaim any liability for decisions made based on the content of this article. Readers are advised to conduct their own research and consult a financial advisor before making investment decisions.?