Bitcoin Faces Crucial Moment: SEC Decision on ETF Applications Sparks Debate and Market Volatility


Bitcoin is on the verge of reaching $45,000, currently trading at $44,104.29. The anticipation centers around potential SEC approval of Bitcoin ETF applications, including those from BlackRock and Fidelity, expected to be decided by January 10, 2024.

Dennis Kelleher, CEO of Better Markets, a non-profit organization, has urged the SEC to reject all applications. In his eleven-page letter, he contends that approval would indirectly endorse fraud and manipulation, compromising investor funds. This stance has faced criticism, with Bitcoin enthusiasts arguing that rejection would thwart the crypto community's efforts to secure ETF approval, impacting the SEC staff dedicated to analyzing applications.

Matrixport's recent report hinted at potential SEC rejection due to applications falling short of unspecified requirements. This triggered a market crash, with BTC dropping below $42,000 and ETH below $2,300.

Despite the negativity, Matrixport analysts believe eventual approval is likely, potentially in the second quarter of 2024. They attribute potential rejections to SEC Chair Gensler's historical skepticism of new crypto products and the predominance of Democratic commissioners involved in the approval process.

Approval of Bitcoin ETFs could set the stage for XRP ETFs, though this remains speculative. Ripple supporters suggest that if the SEC greenlights Bitcoin ETFs, the community may push for XRP ETF applications. However, management firms or issuers have yet to express interest, leaving this speculation.

In case of rejections, the community may anticipate the second quarter and the subsequent Bitcoin Halving, reducing token supply and potentially increasing its price. The SEC has not responded to Kelleher's plea, leaving the outcome uncertain until a few days later when the SEC's decision on BTC unfolds.

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