In a recent report, analysts at cryptocurrency analysis firm QCP Capital commented on the recent rally in Bitcoin price to above $44,000.
Since the beginning of the month, Bitcoin has experienced another exponential increase, with a 15% increase in the first week alone. This increase has translated into a staggering 260% year-to-date (YTD) gain.
Analysts attribute this increase to the latest announcement made by the spot Exchange Traded Fund (ETF) and the Securities and Exchange Commission (SEC) on December 1. The SEC set January 5, 2024 as the deadline for adverse comments, paving the way for possible approval the following week.
QCP Capital: “Spot ETF Approval May Cause a 'Sell the News' Phenomenon Contrary to Expectations”
With Bitcoin approaching $45,000 ahead of the official announcement in the second week of January, questions arise about how much of this news is factored into the price. According to analysts, Bitcoin's future depends on the actual flows the ETF generates in its first few weeks of trading, including whether it will revisit its all-time high of $69,000. This could potentially create a classic “sell the news” moment next year.
The SEC's announcement also sparked interest among Asian buyers who had been inactive over the past month. Most of the spot gains have occurred during US trading hours since mid-October.
When the Spot ETF launches, investors will have a multitude of product options, with 13 applications currently vying to be among the first batch.
Even if Bitcoin peaks on launch day, the growth of the traditional financial ecosystem around Bitcoin and soon Ethereum (ETH) is unlikely to stop, analysts say. Analysts have been predicting this explosion for years.
*This is not investment advice.
