In 2023, a major event shook up the crypto market: the application by BlackRock, the world's largest asset manager, to create the first Bitcoin cash exchange-traded fund (ETF). This SEC application acted as a catalyst for the market, reinvigorating the entire crypto ecosystem.
Every piece of news about the imminent approval or postponement of this ETF had an immediate and significant impact on the market. Bitcoin, in particular, has seen impressive growth, up around 160% this year. The Grayscale Bitcoin Trust, one of the first exchange-traded products backed by physical Bitcoin, has also performed well.
At present, a potential approval of this Bitcoin ETF could occur before 10 January 2024. Pending this event, the market could see a new wave of bullishness. This cash ETF is seen by many as a sign of maturity and increased legitimacy for cryptos in the eyes of institutional investors and the general public.
In short, SEC approval of a Bitcoin ETF could mark a watershed moment for the crypto market, attracting new investors and boosting confidence in the asset class. The impact of such approval would go far beyond a simple price rise; it would signal a step towards legitimising and integrating cryptos into the traditional financial system.
The US Securities and Exchange Commission (SEC) yesterday issued a statement with the evocative title "No Go to FOMO". A warning to investors, urging them to resist the fear of missing out (FOMO) on cryptos and other digital assets.
This warning comes at a critical time. The stock market regulator is preparing to rule on a long-awaited request: approval of the first ETF backed by the Bitcoin spot price (Bitcoin Spot ETF).
However, in contrast to these calls for caution, enthusiasm is at its peak among players in the cryptocurrency market. Most are anticipating the imminent green light from the SEC, a decision that would mark a turning point and pave the way for mass adoption of Bitcoin.
In its press release, however, the SEC points out the risks inherent in these cryptos. It highlights their extreme volatility and dependence on fads.
According to the SEC, many tokens such as NFTs, memes and ICOs owe their speculative value mainly to their popularity. Their price can fluctuate dramatically, with variations of up to 50% in a single day.
Faced with this unbridled craze, the SEC is calling on investors to be cautious and to develop diversified strategies that are much less risky. It clearly fears a speculative bubble around Bitcoin, whose volatility would only increase if an ETF were to be validated.
The 15 January deadline is fast approaching. Some players believe that the SEC will give the green light, opening the door to widespread adoption by institutions and marking a significant turning point for the market.