Bitcoin ETF News Sparks Hope
The K33 Research report indicates that if the United States approves bitcoin spot ETFs, it will make it easier for you to access bitcoin. This accessibility would reduce the risk of a traditional 60/40 portfolio by diversifying into the digital asset.
The analysts argue that diversification and risk-adjusted outperformance would be the key go-to-market strategies from the various ETF providers. Besides, since 2020, bitcoin has proven to be a powerful tool for portfolio diversification.
Last week, the SEC delayed decisions on Hashdex and Franklin’s proposed bitcoin spot ETFs. The SEC also postponed a decision on Global X’s application, and now, the emphasis has shifted to the next deadline on Jan. 10.
Bitcoin Consolidates Amid Market Volatility
Despite the volatility in the crypto markets, bitcoin has continued to consolidate. It is up a modest 2% over the past week despite significant news-induced volatility.
Ether’s underperformance against bitcoin has continued as it fell 2%, while Binance’s BNB is up around 8% in the last week. Traders also maintained their upside exposure to bitcoin on the CME with futures premiums staying well above double digits and open interest at all-time highs.
Crypto Natives on the Fence
Perpetual traders in the crypto market have adopted a more cautious approach, reducing the likelihood of liquidation squeezes in the near term. Open interest remained at an 18-month low over the past week, and funding rates returned to neutral levels, indicating more balanced market sentiment.
Hot Take: Positive Signs for Bitcoin ETF Approvals
While the SEC’s decision to delay approving bitcoin spot ETFs may have caused a temporary setback, the future outlook remains positive. The delay allows for more time and hope for an approval following the next deadline on Jan. 10. The market signals and active communication between the SEC and bitcoin spot ETF filers indicate increasing odds of approvals in the near future.
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