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According to a recent report by blockchain data analysis firm CryptoQuant, the potential approval of ongoing spot Bitcoin ETF application processes in the United States could turn into a “sell the news” event. CryptoQuant analysts have made notable statements regarding the matter. Let’s take a closer look at what needs to be considered during this process.
CryptoQuant Analysts Predict ETF Outcomes
To support the claims about potential ETF approvals, CryptoQuant analysts pointed to data showing that Bitcoin market participants are currently making significant profits following the crypto asset’s rise above the $40,000 level. The report stated the following:
“Short-term Bitcoin holders have historically achieved high unrealized profit margins of 30% before price corrections.”
CryptoQuant analysts added that Bitcoin miners are also achieving high unrealized profits, which could contribute to selling pressure on the Bitcoin front. The report included the following statement:
“As Bitcoin has been trading above $40,000, we have seen an increase in sales by mining companies over the past few weeks.”
What’s Expected for Bitcoin?
According to analysts, during corrections in bull markets, Bitcoin’s price tends to return to the recently achieved levels in the short term. The report suggests that in a “sell the news” scenario, Bitcoin’s price could drop, potentially falling to the $32,000 level.
Bloomberg Intelligence analysts give a 90% probability to the approval of a spot Bitcoin ETF by the U.S. Securities and Exchange Commission in the first quarter of 2024. With all these developments, the first spot Bitcoin ETF application is expected to be approved by January 10th.
Since the beginning of the year, Bitcoin’s gains are currently over 155%, and the rise of the crypto asset is largely due to an optimistic period where the SEC is believed to be ready to approve one or more of the spot Bitcoin ETF applications made to the regulatory body. Many investment firms, including BlackRock, WisdomTree, and Valkyrie, are awaiting the green light from the SEC.
