Investors Approaching Bitcoin ETF Decision with Caution
Investors and traders are adopting a more cautious approach as they await the decision from the US Securities and Exchange Commission (SEC) regarding the approval of a Bitcoin exchange-traded fund (ETF). The recent leverage purge and the possibility of a delayed approval have influenced this mindset, according to Jacob Joseph, a research analyst at CCData. The subdued price action witnessed in the last 24 hours can be attributed to this cautious sentiment. While it is still likely that a spot Bitcoin ETF will receive approval soon, any unexpected delay could result in a significant downturn for digital assets.
Major Asset Managers Await SEC Decision on Bitcoin ETFs
BlackRock Inc. and Fidelity, among other major asset managers, have filed applications for ETFs tied to Bitcoin. The SEC has until January 10 to approve or reject these applications. Bloomberg Intelligence analysts predict that the decision could be announced as early as January 8, with a 90% chance of approval for all applications.
Bitcoin Price Drops Amid ETF Delay Rumors
Bitcoin experienced an 8% drop after rumors circulated that the SEC is likely to reject spot Bitcoin ETF applications this month. Matrixport reported on this potential rejection, cautioning traders to hedge their long exposure. However, there are also rumors suggesting that approval could come in the near future. Senior TechCrunch crypto reporter Jacquelyn Melinek recently stated that approval could occur within 24 hours.
Competition Among Issuers for First Bitcoin ETF
With the potential approval of the first Bitcoin ETF by the SEC, issuers are competing to capture investor interest. Fidelity has set a competitive fee of 0.39%, while Invesco/Galaxy announced a fee waiver for the first six months of operation and for the first $5 billion in assets held, followed by a 0.59% fee. Analyst Eric Balchunas predicts that BlackRock will likely set its fee at 0.47%.
Hot Take: Investors Exercise Caution Ahead of Bitcoin ETF Decision
Investors and traders are exercising caution as they anticipate the SEC’s decision on the approval of a Bitcoin ETF. The recent leverage purge and potential delay have influenced this cautious approach. While it is still likely that a spot Bitcoin ETF will be approved, any unexpected delay could lead to a significant downturn in digital assets. Major asset managers have filed applications for Bitcoin ETFs, and the SEC has until January 10 to make a decision. There are rumors of both rejection and potential approval, causing price volatility in the market. Issuers are competing to offer competitive fees to attract investors.
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