Will Spot Bitcoin ETF Applications Receive Approval from the SEC? Potential Impact of an ETF Approval on the Market

With the recent developments in the market, expectations that Spot Bitcoin ETF applications could receive approval from the SEC have significantly strengthened. K33 Research, in a report published during the week, provided an evaluation of the growing expectations for ETF approval in the market and the potential effects that an ETF approval could have.

Will the SEC Give the Green Light to Spot Bitcoin ETFs?

Although the SEC has postponed ETF decisions, the recent victory of Grayscale in its SEC case has strengthened expectations that the SEC could approve Spot Bitcoin ETF applications. Bloomberg ETF analysts Eric Balchunas and James Seyffart have updated their predictions regarding the likelihood of approval for ETF applications.

Balchunas stated that they have increased their predictions for the likelihood of approval for Spot Bitcoin ETF applications to 75%. Balchunas mentioned that the recent significant developments have significantly increased the likelihood of ETF approval, and they stated that their predictions for the possibility of approval for Spot Bitcoin ETFs until the end of 2024 are 95%.

Furthermore, former SEC Chairman Jay Clayton, who served as the chairman of the SEC from May 4, 2017, to December 23, 2020, expressed his expectations that Spot Bitcoin ETFs could receive approval from the SEC in a recent statement. Former SEC Chairman Clayton also included the statement, “It is clear that Bitcoin is not a security.”

What Impact Will a Potential ETF Approval Have on the Market?

Although it has been suggested that Spot Bitcoin ETFs could lead to a significant increase in the cryptocurrency market in the past, despite the recent strengthening of ETF approval, this has not yet had a striking effect on the cryptocurrency market. The leading cryptocurrency Bitcoin (BTC) dropped to levels of $25,500 during the week, and most cryptocurrencies in the market experienced significant losses during this period.

K33 Research analysts evaluated the potential effects that a Spot Bitcoin ETF approval could have in the market, referring to a report published by K33 Research during the week on Cointelegraph. Research analysts Vetle Lunde and Anders Helseth, who stated that a potential Spot Bitcoin ETF approval could lead to high amounts of fund inflows in BTC, also expressed that Spot Bitcoin ETFs could create new buying pressure in Bitcoin.

Although analysts state that a potential ETF approval has not yet been priced in the cryptocurrency market, they also mentioned the possibility of ETF applications being rejected by the SEC. According to analysts, if Spot Bitcoin ETF applications are rejected by the SEC, this may not have a significant negative impact on the cryptocurrency market.