Bitcoin rallied above $44,000 on Thursday as continued optimism over the prospect of an impending spot Bitcoin ETF approval from the Securities and Exchange Commission offset fears sparked by a Bitcoin ETF yesterday ominous report published on the topic.
At the time of writing, BTC is at $44,032, up 4.2% from yesterday's lows.
Digital asset manager Matrixport predicted yesterday that the SEC would likely reject all Bitcoin ETF proposals this month and instead begin approving such applications in the spring. Following the news, BTC immediately plunged by 7%.
But also analysts who have closely followed the SEC's handling of Bitcoin ETF applicants BlackRock, loyaltyAnd Grayscale condemned the report classified as insubstantial and reiterated their assessment that the first Bitcoin ETF will most likely be approved in the USA next week.
It appears that the market has been reassured by such assurances. BTC has now almost completely recovered the losses suffered yesterday.
For better or worse, price action suggests that BTC's reputation is closely tied to the fates of a spot Bitcoin ETF, at least for now.
And for good reason: if the financial product is approved, traditional financial institutions and investors will be able to invest in Bitcoin without owning any cryptocurrency. Analysts have estimated that the instrument could explode Worth $14 trillion from assets to Bitcoin.
Eric Risley, previously managing partner of digital assets consultancy Architect Partners told Decipher that the approval of a Bitcoin ETF would represent a historic game changer and the “legitimization of”. [Bitcoin] Asset class.”
Hopes surrounding the approval of a spot Bitcoin ETF have pushed Bitcoin far in its nearly three-month rally. Since October, the world's leading cryptocurrency has seen its value rise by a remarkable 64.77%, from $26,750.
The views and opinions expressed by the author are for informational purposes only and do not constitute financial, investment or other advice.
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