Bitcoin ETF: Overpriced?

Awaiting acceptance Place Bitcoin ETF In the year Reaching a fever pitch in the opening days of 2024, angry discourse on the topic has now settled around one question: is it already priced?

Some in crypto think the answer is yes. It has been almost two months of uninterrupted gains for BTC Happiness Around the recent approval of Bitcoin ETF. At this point, with a cryptocurrency that nearly doubled in value in October, how much juice is left to squeeze?

But many die-hard Bitcoin advocates emphasize that the phenomenon has not been priced in – which means, in their opinion, that BTC is set to rocket even higher. If and when The Bitcoin ETF will be approved in the coming weeks.

The Bitcoin ETF finally offers traditional retail investors an easy way to gain exposure to BTC – no crypto exchange or wallet required. But the SEC has rejected every proposal for such a product over the past 10 years, citing market manipulation in Bitcoin as the main reason. But that was then and BlackRock is now — and the Wall Street titan's entry into the Bitcoin ETF race means it will eventually happen, say most analysts.

All signs point in the direction of approval, which could lead to a new wave of capital entering the market. That's why some traders and analysts are so bullish on BTC prices following the SEC's green light.

Such predictions focus on the belief that a significant part of the market has failed to process the need for approval of a Bitcoin ETF, given the recent findings, which some experts predict. Change Bitcoin forever Integrating the digital asset with the global economy.

“Given how much the event is priced, how much it hangs in the balance, some money is sitting on the sidelines waiting for confirmation,” strategist Joel Kruger said. LMAX groupHe told him Decrypt.

Krueger predicts that analysts will speculate in the day or two after the first Bitcoin ETF confirmation. next week—BTC price can jump by 10%. At that point, he said, there could be a short period of consolidation and correction before the world's top cryptocurrency starts pumping again. As early as spring, according to the strategist, BTC may break the $69,000 high price it briefly touched at the end of 2021.

James Butterfill, head of research at CoinShares, agrees that BTC is poised to continue its winning streak with the approval of the Bitcoin ETF.

“We don't think it's fully bought for a number of reasons,” he said. Decrypt.

Butterfill points to nearly $14 trillion in U.S. assets, a position he says will have exposure to Bitcoin once the Bitcoin ETF is greenlit. While only a fraction of that market has the potential to tap into it, it's hard to overstate the fact that Bitcoin could soon be theoretically connected to much of the US economy.

Additionally, the analyst noted that inflows into existing Bitcoin investment products in the past quarter came mainly from Europe – suggesting to him that many US investors are waiting for US-based ETFs to become available.

Other analysts, however, are reluctant to paint such a bleak rosy picture of the Bitcoin ETF's price impact.

Vettel Lunde, senior analyst at K33 Research, said in A Report He found Wednesday's 75% approval of the Bitcoin ETF a “sell the news” Event—This is when a medium-term stimulus is considered due to a flood of investors selling the cryptocurrency, which lowers the price of BTC.

“Ahead of the verdict, everything points to traders being heavily exposed, and BTC's last three months of consecutive upside downtrends will push higher premiums,” Lunde said.

The analyst noted that the event could be a boon for BTC, though, if ETF earnings are enough to offset outflows to “sell the news.” By Lunde's estimate, bitcoin ETFs will need to attract $2.3 billion in new revenue in January alone to keep asset prices from falling. That new capital must be truly new; Transferring funds from Bitcoin futures ETFs to newly minted spot Bitcoin ETFs does not count.

Lunde puts the probability of such an outcome at 20%.–It's definitely not impossible, but it's not particularly likely. John Palmer, president of spot crypto clearinghouse Cboe Digital, said earlier Decrypt The scary outcome for the spot Bitcoin ETFs in the first year is to attract $10 billion to $15 billion worth of investment by the end of 2024.