Bitcoin price reclaims above $44,000: Spot Bitcoin ETF updates as window for approval opens

01/04/2024 23:59:00 GMT|ByLockridge Okoth

Bitcoin price is flashing green, recouping part of losses made during the Wednesday crash.
As investors continue to shake off concerns that the US SEC will reject spot BTC ETF applications, recent developments inspire hope.
Senior reporter at TechCrunch says spot Bitcoin ETFs will be approved by the SEC for multiple firms' applications, big news on January 5.

Spot BTC ETF developments ahead of the January 5 window

ETF specialist Eric Balchunas has indicated that the SEC is giving final comments after which the issuers will submit final 19b-4s and S-1s. According to Balchunas, “This is definitely as close to done as we've been [to a spot BTC ETF approval] but no official approval as far as I know.”

James Seyffart, also an ETF specialist with Bloomberg, thinks the SEC could begin signaling to issuers to expect approvals officially between January 8 and 10, adding that the gap between approval orders and actual trading will be measured in days and not weeks.

Elsewhere, sources close to the proceedings say the SEC could begin notifying issuers of approval on Friday, January 5, with trading beginning as early as the following week.

Bitwise surveyed over 400 financial advisors in November and December of 2023, with the findings show that only 39% expect an ETF approval in 2024.

A senior reporter at TechCrunch, Jacquelyn Melinek, reports that spot Bitcoin ETFs will be approved by the SEC for multiple firms' applications, with the news expected tomorrow, citing “sources extremely close to the matter.”

heard from sources extremely close to the matter that the bitcoin spot ETF is going to be approved by the SEC for *multiple* firms' applications
— Jacquelyn Melinek (@jacqmelinek) January 4, 2024

Grayscale has officially listed GBTC on their retail-facing website. Experts say that legally this is only possible if it is approved as The firm’s Craig Salm says he is “just filling out some forms.”

Just filling out some Forms
— Craig Salm (@CraigSalm) January 4, 2024

ARK Invest just filed a 'Registration of Securities' for its spot Bitcoin ETF

Former Citigroup executives are launching Bitcoin depositary receipts, bypassing US regulatory approval. Unlike Bitcoin ETFs converted to cash, these receipts offer direct ownership of Bitcoin for qualified institutions. Nevertheless, Eric Balchunas believes these will be a "tough sell" with ETFs around the corner.

The head of research at CoinShares James Butterfill says the current Bitcoin prices suggest the market is pricing $1 billion seed into US spot-based ETFs, basing his assumption on the firm's fund flows model.

Bitcoin price outlook

Meanwhile, Bitcoin price has reclaimed the $44,000 psychological level. It holds above the midline of the weekly supply barrier at $43,860, though not decisively. By and large, there is still no directional bias as the market exercises caution. This is after the January 3 crash that saw both sides taken out, with shorts as well as longs rekt.

Evidence of this is in the BTC liquidations heat map, showing that Bitcoin price is in the middle of nowhere. For the next directional bias, therefore, the market may have to wait for positions to build up again.

BTC liquidations heat map

At the time of writing, Bitcoin price is trading at $44,382 after recouping most of the ground lost in the Wednesday crash. On the weekly timeframe, BTC remains within the weekly supply zone but has breached its midline, which is a good sign.

The Relative Strength Index is moving north to show rising momentum while the Average Directional Index (ADX) is rising on the weekly timeframe to show the prevailing trend is strengthening.

BTC/USDT 1/day chart, BTC/USDT 1-week chart

Crypto ETF FAQs

What is an ETF?

An Exchange-Traded Fund (ETF) is an investment vehicle or an index that tracks the price of an underlying asset. ETFs can not only track a single asset, but a group of assets and sectors. For example, a Bitcoin ETF tracks Bitcoin’s price. ETF is a tool used by investors to gain exposure to a certain asset.

Is Bitcoin futures ETF approved?

Yes. The first Bitcoin futures ETF in the US was approved by the US Securities & Exchange Commission in October 2021. A total of seven Bitcoin futures ETFs have been approved, with more than 20 still waiting for the regulator’s permission. The SEC says that the cryptocurrency industry is new and subject to manipulation, which is why it has been delaying crypto-related futures ETFs for the last few years.

Is Bitcoin spot ETF approved?

Bitcoin spot ETF has been approved outside the US, but the SEC is yet to approve one in the country. After BlackRock filed for a Bitcoin spot ETF on June 15, the interest surrounding crypto ETFs has been renewed. Grayscale – whose application for a Bitcoin spot ETF was initially rejected by the SEC – got a victory in court, forcing the US regulator to review its proposal again. The SEC’s loss in this lawsuit has fueled hopes that a Bitcoin spot ETF might be approved by the end of the year.

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