Why Bitcoin ETF Approval is different from a “Sell the News” event, according to analysts
There is much speculation within the cryptocurrency community about the anticipated decision on the Bitcoin exchange-traded fund (ETF) this week. While various predictions have been made, one analyst questions the logic behind people “shorting” Bitcoin before the decision.
The United States Securities and Exchange Commission (SEC) is expected to provide a decision to ARK 21Shares on its spot Bitcoin ETF application on January 10. This has sparked a debate among crypto commentators on the potential impact on Bitcoin’s price.
Alex Becker, a prominent analyst, believes that the approval of a Bitcoin ETF will not lead to a “Sell the news” event. He argues that instead, it will open up the asset to a larger pool of wealthy individuals who may have never invested in crypto before. This is because the ETF provides a more traditional way of investing, similar to the stock exchange.
While some are uncertain about the potential downside if the ETF is approved, Dan Webb, an engineering lead at Swan Bitcoin, suggests that the downside will not be as drastic as the potential upside in the event of positive news. He questions the risk-reward of shorting Bitcoin, given the limited potential gains for shorts.
Mati Greenspan, the Founder and CEO of Quantum Economics, previously stated that he doesn’t believe SEC Chair Gary Gensler will approve any crypto-related ETFs. Greenspan believes Gensler may try to delay crypto innovation to favor traditional bankers who support him.
Overall, analysts are divided on the potential impact of the Bitcoin ETF decision. However, many argue that it will not be a typical “Sell the news” event, as approval could bring in more institutional investors and expand the overall market for Bitcoin.