There has been a major cryptocurrency crash this week following warnings by analysts. This resulted in major currencies like Bitcoin, Ethereum, and XRP having a huge drop in value. At the start of 2023, things were quite different. Bitcoin had greatly boosted its price, but this rally did not last long it seems. The Fed’s plans could greatly derail the route of cryptocurrencies, thus crashing trader confidence and a crypto dip.
The SEC has recently been contemplating a decision on a Bitcoin ETF application. Traders are watching the SEC’s moves closely, and the choices they make could make huge impacts. This would effect major asset managers like BlackRock, VanEck, Grayscale, WisdomTree, and Invesco.
There are several decisions the SEC could make. It could make a “delay”, “deny”, or “approve” choice on 5 Bitcoin bids from September. These ETF spots sum up to a total of $15.5 trillion in value, so it is obvious why any moves by the SEC could have great repercussions.
What most traders are expecting the SEC to do is delay their decision according to analysts. This would lead to great disappointment among traders, and the effects on the market will be obvious. Any crypto bubbles would soon burst.
Meanwhile, in Europe, there has also been some action. A spot Bitcoin ETF has finally gone live on European markets this week. Specifically on Euronext Amsterdam. This was after an earlier decision in October 2021 from the GFSC.
As the number of ETFs available grows in the markets, the market growth will be considerable too. This will allow cryptocurrencies to have closer integration with financial markets, improving reliability and trustworthiness. Traders can finally diversify their crypto investments to ensure greater security for their funds. All of this could help towards the next crypto bull run.
Despite this good news for the crypto market, decisions in the US matter too. The bearish sentiment over the last month has given people the sense that any approval regarding ETFs likely will not happen in the US. The overall sentiment is, therefore, not great for now so the crypto dip may last.
