Bitcoin Price Drops As SEC Delays Bitcoin ETF Decision
On 31 August, the US Securities and Exchange Commission rejected several Bitcoin ETF applications. As a result, the Bitcoin price keeps seeing a drop.
The SEC has delayed Spot Bitcoin ETF applications from BlackRock, WisdomTree, VanEck, Bitwise, Valkyrie and Fidelity, as well as a joint application by Invesco and Galaxy. Companies can re-file in 45 days. The SEC might postpone the filings until March, when it will have to make a decision.
Amid the SEC's latest ruling, Bitcoin's price fell below $26,000, losing about 4% of its value. This price dynamic differs from how the major cryptocurrency reacted to Grayscale's victory in court against the SEC days earlier. At that time, Bitcoin rose to $28,000.
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Grayscale's victory raised hopes that the regulator might ease its policy towards Bitcoin ETFs and accept the applications submitted. However, this did not happen.
Bitwise, which decided to withdraw its ETF application, acted unexpectedly. Perhaps the company is changing its strategy, having clarified in a statement to the SEC that the fund cannot guarantee the achievement of its clients' investment goals.
Bloomberg analyst Eric Balchunas said that the SEC will ultimately have no choice but to approve the applications.
Getting asked about deadlines coming this Friday. We will not be surprised if the SEC delays given the ruling JUST happened. That said, not sure timelines will matter as much in this situation, prob more likely we wake up one day and hear SEC has given in and launch imminent.— Eric Balchunas (@EricBalchunas) August 30, 2023
Despite the Bitcoin price's performance, the crypto community is hopeful that Spot Bitcoin ETF applications will be approved by the end of this year.