Greekslive: Spot Bitcoin ETF approval unlikely until 2nd week of January

January 3, 2024 at 3:16 pm

Edited by Brian Stone

News

Greekslive: Spot Bitcoin ETF approval unlikely until 2nd week of January

Options trading analysts pointed to Jan. 10 and beyond as the timeline for an SEC decision on spot Bitcoin ETFs amid bearish speculation that all applications may be rejected.

Greekslive noted that a U.S. Securities and Exchange Commission (SEC) stand on spot Bitcoin (BTC) ETFs was unlikely to arrive before Jan. 7, citing stock price actions from crypto mining operations and digital asset-related companies in America.

Current month puts are now cheaper, and block trades are starting to see active put buying, with options market data suggesting that institutional investors are not very bullish on the ETF market.
Greekslive on X

The likelihood of the ETF's passage became less and less likely, and the market saw a stalemate. Weakness in crypto mining stocks, and the sell-off in several crypto-related U.S. stocks, also reinforced the market's skepticism.
ATM option IV plummeted to 52% for the week and… pic.twitter.com/orjr1Wcwwf
— Greeks.live (@GreeksLive) January 3, 2024

The report was released to a market gripped by speculation surrounding 14 spot Bitcoin ETF applications filed by TradFi giants like BlackRock and crypto-native entities like Hashdex. Such products have been historically rejected by the SEC, although recent developments indicated by multiple meetings and updated filings fueled optimism for a different outcome in 2024.

However, some opinion leaders surmised that the SEC could delay spot Bitcoin ETFs beyond January. Indeed, Matrixport said the SEC may reject all bids for a fund that invests in Bitcoin at spot prices as crypto.news reported.

Legal experts said this outcome could result in litigation against the SEC due to a court ruling during the Grayscale case.

If the @SEC were to deny all spot $BTC ETFs, the applicants would immediately sue and the D.C. Court of Appeals would again rule that the SEC was “arbitrary & capricious.”

The SEC gave every reason they had for denying Grayscale—and lost.

I expect multiple approvals on Jan. 10.
— MetaLawMan (@MetaLawMan) January 3, 2024

A massive 7% drop followed the report from Matrixport in BTC’s price as the token dipped below $43,000 and triggered over half a billion in liquidations across crypto markets. These liquidations had occurred within only four hours at press time.

While Matrixport expects Bitcoin to return toward $36,000, the company foresees a surge in BTC prices this month. Analysts at the crypto startup predicted a surge to at least $50,000 before February and a new all-time high above $125,000 by the year’s close.