Bitcoin Price At Risk of Crashing 20% Dropping Below $36,000
Mustafa Mulla3 Jan 20242 min read
Today, Matrixport has predicted that the US Securities and Exchange Commission will strike down all January applications for Bitcoin spot exchange-traded funds (ETFs). Despite intensive talks between hopeful applicants and the SEC, Matrixport believes every proposal falls short of crucial hurdles preventing approval. Let’s see how this prediction has affected the Bitcoin price.
The bold prediction has already affected Bitcoin, as 400 million bitcoins have liquidated in just two hours. Reports urge traders to shield their long holdings by buying $40.000 in put options expiring at the end of January or even taking the plunge and betting against Bitcoin outright with options.
According to Matrixport, there’s a hidden key the SEC demands applicants unlock before they can crack the Bitcoin spot ETF vault. While they believe this requirement could be met by the second quarter of 2024, they see January as a month of rejections. The nature of this critical requirement has not been disclosed, but it is likely related to regulatory compliance and investor protection.
Matrixport believes the crypto market could see significant price corrections if the SEC rejects the applications. They estimate a potential 20% drop in Bitcoin prices, suggesting a fall back to the $36,000 to $38,000 range.
Impact On the Crypto Market
The predictions have already impacted the crypto market, with Bitcoin prices falling by 8%, and investors are unhappy to see their portfolios decline. The likelihood of ETF approval became less likely, leading to weakness in crypto mining stocks and the sell-off of several crypto-related US stocks. If the SEC rejects all proposals by chance in January, as predicted by the report, it could lead to further volatility and liquidations in the crypto market.
Reaction from the Crypto Industry
Investors and traders are going crazy over the sudden slip in the price of Bitcoin, and some are just taking a spin. Many prominent figures are reacting to the dip, and some believe it is due to negative reports on ETFs.
John Deaton reacted, “Let’s be honest, it wasn’t about some negative report on the ETFs – it was the CRAMER CURSE that did it!”
This discussion about spot Bitcoin ETFs and Bitcoin prices is never-ending. Traders should carefully consider their exposure to Bitcoin and other cryptocurrencies and seek professional advice before investing.
