Matrixport, a prominent player in cryptocurrency financial services, anticipates that the US Securities and Exchange Commission (SEC), predominantly comprised of Democrats, will decline all proposals for spot Bitcoin exchange-traded funds (ETFs). This decision is expected to influence Bitcoin prices negatively.
The SEC, led by Chairman Gary Gensler, has shown a consistent approach toward implementing more stringent regulations in the cryptocurrency space. The likelihood of Gensler and the SEC endorsing a Bitcoin ETF seems minimal, aligning with the broader political landscape. The underlying rationale includes the reluctance to validate Bitcoin as a viable alternative for value storage.
Influence of SEC’s Decision on Bitcoin Market
Quantum Economics’ Founder and CEO, Mati Greenspan, shared his insights, emphasizing Gensler’s probable reluctance to greenlight a crypto-related ETF. He suggests that Gensler’s decisions could be influenced by his commitments to major banking institutions.
Market analysts, including Greekslive on X, have noticed a trend of skepticism towards crypto ETF approvals. This skepticism is partly due to recent downturns in crypto-related stocks and the broader market. Additionally, options market data indicates a lack of strong optimism among institutional investors regarding the ETF market.
Bitcoin’s Projected Trajectory
Looking ahead, CryptoQuant, a respected analytics company, projects a potential decline in Bitcoin’s value, possibly dropping to around $32,000 by the end of January. This forecast is based on patterns of high unrealized gains historically leading to price corrections. Despite a bearish outlook on the ETF approvals, Matrixport envisions Bitcoin’s value at the end of 2024 surpassing its current rate.
As the deadline for the first Bitcoin ETF approval decision approaches on January 10, 2024, the market remains watchful. Bitcoin’s performance at the end of the previous year, which saw an over 150% increase from its level in January 2023, adds to the anticipation surrounding the SEC’s impending decision.