A week of high stakes and expectations

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As a decision on Bitcoin (BTC) exchange-traded funds (ETFs) nears, aspiring crypto businesses, investors and regulators are taking definitive steps to best prepare for the unknown.

Jan. 10, 2024 has come, meaning that the community may finally find out whether the first spot Bitcoin ETFs will start trading tomorrow and whether fake approval news from securities regulators in the United States would have any impact.

Some community observers have noticed that the long-awaited date of the potential ETF approval marks 15 years after Hal Finney’s “Running Bitcoin” tweet.

“There are no coincidences,” VanEck strategy adviser Gabor Gurbacs stated.

Spot Bitcoin ETF approval is expected between 4:00 pm ET and 6:00 pm ET on Wednesday, Balchunas says

The community is celebrating the day of potential approval of a spot Bitcoin ETF in the United States, as many analysts expect the Securities and Exchange Commission (SEC) to finally approve several such ETFs today.

According to Bloomberg ETF analyst Eric Balchunas, the SEC will likely issue the approvals between 4:00 pm ET (9:00 pm UTC) and 6:00 PM EST (11:00 PM UTC). Following the approvals, the first spot Bitcoin ETFs are anticipated to start trading as soon as Thursday, Jan. 11, according to the analyst.

The anticipation by analysts like Balchunas comes amid concerns that potential approval of a spot Bitcoin ETF in the U.S. could be delayed another time due to a scandal with the SEC’s X (formerly Twitter) posting fake ETF approval news on Jan. 9, with the agency citing a hack of its social media account.

While some suggested the SEC could use the recent unauthorized post as an excuse to delay an ETF approval, most saw it as a remote possibility.

Bitcoin briefly tumbled below $45,000 amid looming ETF decision by SEC

Bitcoin continued facing sharp volatility amid the looming ETF decision by the SEC. BTC price briefly slipped below $45,000 at 08:00 am ET (01:00 pm UTC). According to data from CoinGecko, BTC price tumbled to as low as $44,600, posting a 5% drop. 

The price of Bitcoin has been also on the decline over the past 24 hours. At the time of writing, BTC is trading at $45,082, down around

Bitcoin (BTC) 24-hour price chart. Source: CoinGecko

According to CoinGecko, Bitcoin is still up around 6% over the past seven days. The cryptocurrency is 51% down from its all-time high of $68,000 posted in November 2021.

Bitcoin short ETPs record $1M weekly outflow, anticipating spot BTC ETF approval

While digital asset investment products, or exchange-traded products (ETPs), saw inflows of $151 million in the first week of 2024, outflows from Bitcoin short positions totaled over $1 million.

Investment flow into various crypto assets. Source: CoinShares

Earlier, many market pundits predicted that the potential approval of the BTC ETF could be a “buy the rumor, sell the news” event, but the latest digital asset investment flow data contradicts that claim, with significant outflows in the past several weeks.

Bitcoin index tips into “extreme greed” as market holds its breath for ETFs

The Crypto Fear & Greed Index signaled “extreme greed” market sentiment among crypto investors. According to the Crypto Fear & Greed Index, Bitcoin’s market sentiment score is 76 out of a possible 100 — its highest score since Bitcoin hovered around its highest price of $69,000 in mid-November 2021.

The fear and greed sentiment slipped a bit on Jan. 10 amid potentially looming approval of a spot Bitcoin ETF in the United States, which is largely expected to happen on Wednesday. According to the index, Bitcoin’s market sentiment tumbled from “extreme greed” score of 76 to just “greed” score of 73 on Jan. 10, signaling a slight decline in investors’ willingness to buy more BTC.

Crypto Fear & Greed Index score as of Jan. 10. Source: Alternative.me

The Bitcoin sentiment index briefly tipped into “extreme greed” on Dec. 5 at a score of 75. Bitcoin broke the $40,000 mark on Dec. 4 and surged to $44,000 a day later.

Before that, the index last swung to “extreme greed” on Nov. 11, 2021, when it scored 77. According to data, Bitcoin reached its all-time high price only a day earlier.

Standard Chartered tips $200,000 Bitcoin by late 2025 if ETFs approved

Multinational bank Standard Chartered has forecast that Bitcoin could reach nearly $200,000 by the end of 2025 if BTC ETFs are approved and successful as investment products.

“If ETF-related inflows materalize as we expect, we think an end-2025 level closer to USD 200,000 is possible,” said Standard Chartered head of digital assets Geoff Kendrick and precious metals analyst Suki Cooper in a Jan. 8 report, which has been shared on X (formerly Twitter).

The bank’s price prediction assumed that between 437,000 and 1.32 million BTC would be held in United States-listed spot Bitcoin ETFs by the end of 2024. The firm estimates this to equate to between $50 billion and $100 billion in inflows.

Hashdex spot Bitcoin ETF left out of amended S-1 filings — What does it mean?

While multiple asset managers filed S-1 form amendments on Jan. 8 as part of the process to receive approval for listing shares of a spot BTC ETF fund on U.S.-based exchanges, crypto asset management company Hashdex didn’t issue an amended form.

According to Bloomberg ETF analyst Jeff Seyffart, Hashdex’s Bitcoin ETF application differed from those of other firms in that it was applying to convert an existing crypto futures ETF. Hashdex submitted its application to the SEC in August, proposing a futures investment vehicle that could also hold spot Bitcoin.

Gary Gensler issues warning on crypto ahead of potential spot Bitcoin ETF approval

U.S. SEC Chair Gary Gensler called on crypto investors to keep some things in mind as many asset managers await the final word on approval or denial of their spot BTC ETF applications. He later urged caution on crypto investments, claiming there were “serious risks” without explicitly mentioning the potential ETF approval.

Despite uncertainties around the SEC’s decision to approve one or many BTC ETFs at the same time, applications are in for Valkyrie, WisdomTree, BlackRock, VanEck, Invesco and Galaxy, Grayscale, ARK Invest and 21Shares, Fidelity, Bitwise and Franklin Templeton.

The S-1 filings on Jan. 8 were expected — part of a deadline from the SEC following many 19b-4 filings on Jan. 5. While both suggested a forward move for the SEC to allow crypto ETF listings on U.S. exchanges, they do not guarantee approval.

Update (Jan. 9 at 5:36 pm UTC): This article has been updated to include a Jan. 9 X post from SEC chair Gary Gensler.