This week is extremely important due to the Bitcoin spot ETF approval deadline. This week will end investors’ years of waiting to get a Bitcoin ETF approved by the US Securities and Exchange Commission (SEC). As a result of this crucial event, it could bring in volatility like never before.
Key events for this week
- Bitcoin ETF week: potential ETF approval by Wednesday or Thursday.
- US inflation data release on Thursday.
Read more: Bitcoin spot ETF approval could come as soon as Tuesday, new filings hint
US inflation data
On Thursday, the US Bureau of Labor Statistics will announce the inflation numbers for December. The headline inflation number was 3.1% for November, and forecasts currently sit at 3.2%, a slight increase.
If the actual inflation number is equal to or lower than the previous one, it could reinforce bets of Fed rate cuts earlier this year. On the other hand, if the inflation rate meets expectations, i.e., it comes in hotter than expected, it would further add to the Fed’s hawkish stance.
In such a case, the risk-on markets are likely to take a minor hit.
Potential Bitcoin spot ETF launch
The crypto market has been awaiting a potential Bitcoin spot ETF approval for years. Investors are excited this week as ETF approval is closer than ever before. With amended 19b-4 filings on January 5, the US SEC could announce its decision soon.
Analysts are expecting this decision to come out late Wednesday or Thursday as the big day when the SEC finally gives the green light to that long-awaited Bitcoin spot ETF.
Bloomberg’s Katie Greifeld noted that ETF issuers have until Monday at 8 AM ET to submit S-1s and that the SEC plans to vote on the 19b-4s and S-1s in the coming days. Greifeld added,
If both 19b-4s and S-1s are approved, ETFs could start trading as soon as the next day.
If it happens, all bets are off! Bitcoin price could blast off and potentially retest $50,000 or go higher. Additionally, the value of Bitcoin-related altcoins like Bitcoin Cash (BCH), Bitcoin SV (BSV), and Stacks (STX) could also increase.
Trading ETF news and hedging
Traders are likely to hedge their Bitcoin longs by shorting Ethereum or other altcoins. While some investors chase Bitcoin's skyward trajectory, others might see the ETF news as a signal to "sell the news" and exit their altcoin positions. This could trigger a temporary altcoin dip.
Read more: BlackRock might be on track to create history with $2 billion inflows in spot Bitcoin ETF in a week
(This story was corrected on January 8 at 10:40 GMT to say that US inflation data will be released by the US Bureau of Labor Statistics, not by the Federal Reserve. It was also corrected to say that markets expect US inflation to come in at 3.2%, not 3.3%.)
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
Polygon joins forces with WSPN to expand stablecoin adoption
WSPN, a stablecoin infrastructure company based in Singapore, has teamed up with Polygon Labs to make its stablecoin, WUSD, more useful in payment and decentralized finance.
Coinbase envisages listing of more meme coins amid regulatory optimism
Donald Trump's expected return to the White House creates excitement in the cryptocurrency sector, especially at Coinbase, the largest US-based crypto exchange. The platform is optimistic that the new administration will focus on regulatory clarity, which could lead to more token listings, including popular meme coins.
Cardano's ADA leaps to 2.5-year high of 90 cents as whale holdings exceed $12B
As Bitcoin (BTC) gets closer to the $100,000 mark for the first time — it crossed $99,000 earlier Friday — capital is rotating into alternative cryptocurrencies, creating a buzz in the broader crypto market.
Shiba Inu holders withdraw 1.67 trillion SHIB tokens from exchange
Shiba Inu trades slightly higher, around $0.000024, on Thursday after declining more than 5% the previous week. SHIB’s on-chain metrics project a bullish outlook as holders accumulate recent dips, and dormant wallets are on the move, all pointing to a recovery in the cards.
Bitcoin: Rally expected to continue as BTC nears $100K
Bitcoin (BTC) reached a new all-time high of $99,419, just inches away from the $100K milestone and has rallied over 9% so far this week. This bullish momentum was supported by the rising Bitcoin spot Exchange Traded Funds (ETF), which accounted for over $2.8 billion inflow until Thursday. BlackRock and Grayscale’s recent launch of the Bitcoin ETF options also fueled the rally this week.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.