- January 10th approval of a Bitcoin ETF expected, causing buzz, but CryptoQuant warns of a possible downturn.
- CryptoQuant forecasts a potential price dip to $32,000 due to a probable scarcity of fresh liquidity from the ETF.
- Market cap surge since October, according to CryptoQuant, suggests the projected January boost might have already taken effect.
- CryptoQuant posits that pre-2021 BTC investors are inclined to hold, easing the likelihood of substantial sell-offs.
- Ark Invest swapping GBTC shares for BITO shares showcases diverse investor strategies towards forthcoming BTC ETFs.
A forthcoming Bitcoin ETF, expected to gain SEC approval by January 10, 2024, has stirred a mix of excitement and skepticism within the crypto sphere. Many anticipate a surge in Bitcoin's value, envisioning an upward trajectory post-approval.
However, not everyone shares this optimism. CryptoQuant, a prominent blockchain analytics firm, warns of a potential "sell the news" scenario upon the ETF's approval. This could prompt investors who've been holding BTC in anticipation to cash out, triggering a significant market downturn, potentially dropping Bitcoin's price to as low as $32,000, as per CryptoQuant's analysis.
CryptoQuant argues that the anticipated influx of liquidity post-ETF approval might not materialize as expected. They note that the market has been witnessing a steady rise in Bitcoin's market cap since October, suggesting that the influx may have already been occurring over the past few months.
Despite this cautionary perspective, CryptoQuant believes that long-term holders, particularly those who invested in Bitcoin around 2021 or earlier, are unlikely to offload their holdings.
In contrast, ARK Invest, notably Cathie Wood's firm, has made significant moves pre-ETF. They've divested their shares in the Grayscale Bitcoin Trust (GBTC) and reinvested profits into BITO shares, becoming the second-largest BITO holder with a $100 million stake. This strategic shift indicates differing investor approaches: some preparing for potential gains while others adjust their positions ahead of the ETF's arrival.
This divergence in strategies highlights varying expectations among investors. While some are bullish, eagerly embracing a futures-based ETF launch, others brace for a sell-off, highlighting the uncertainty around the ETF's impact on the market.
Ultimately, the market's response to these imminent ETFs hinges on the tug-of-war between buyers and sellers. It remains uncertain which perspective will dominate and steer Bitcoin's immediate future.
Please note that the information provided is sourced from available reports and analyses. Crypto markets are highly volatile, and decisions should be made after conducting thorough research and analysis.
