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According to a recent K33 report, the approval of a spot Bitcoin (BTC) ETF (Exchange Traded Fund) is “nailed on” for January. K33 head of research Anders Helseth and senior analyst Vetle Lunde say that the recent ETF application updates will strengthen the likelihood of approval by the US SEC (Securities and Exchange Commission).
Also Read: Bitcoin: BlackRock Moves Closer to BTC ETF, Makes Amendments
BlackRock and ARK Invest have agreed to a cash-creation setup for their respective funds. Both firms will accept cash to buy BTC to create shares for their ETFs.
The researchers also highlighted Bitcoin’s (BTC) price action over the previous week. They stated, “This is indicative of BTC’s strong rally attracting new buyers while also motivating profit-taking by sellers, leading prices to consolidate on elevated trading volume.“
Nonetheless, the report notes that open interest on BTC perpetual contracts has fallen to yearly lows. It further adds that there are “no signs of retail froth.” However, the researchers say that this development will likely change after approval.
Bitcoin traders to realize profits: K33
K33’s report, however, warns that institutional traders may book profits following the approval by the SEC. In this scenario, we may see a correction in BTC’s price. According to the report, “active traders will probably realize profits on their current long positions. In combination, this creates the setup for reduced CME dominance ahead.“
Also Read: Grayscale CEO: Spot Bitcoin ETF to Unlock $30 Trillion.
According to Bloomberg analysts, the US SEC may approve one or more spot Bitcoin (ETC) ETF applications by Jan. 10, 2024. The SEC has postponed every deadline in 2023 and may come to a decision early next year. However, the financial watchdog may delay its decision due to technical reasons. The agency is also pursuing legal action against several cryptocurrency firms in the US, such as Coinbase.
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