Spot Bitcoin ETF Approval Unlikely in January Reveals Matrixport
The crypto financial services platform Matrixport has revealed that the US Securities and Exchange Commission is unlikely to approve any Spot Bitcoin Exchange-Traded Fund in January. The latest report from the crypto platform has predicted the price of Bitcoin declining “back to the USD 36,000/38,000 range.”
Applicants Likely to Meet the SEC Demand After January
The crypto financial services platform, Matrixport, has released a new report that the US Securities and Exchange Commission (SEC) is unlikely to approve Spot Bitcoin Exchange-Traded Funds (ETF) on or before January 9. The January 2 report categorically mentions that “all applications [will] fall short of a critical requirement that must be met before the SEC approves.”
The Matrixport report has stated that Spot Bitcoin ETF applicants are only likely to meet the demands of the SEC after January. The SEC and Spot Bitcoin ETF applicants have held several meetings to resolve the issues. Reports indicate that applicants like Blackrock and Grayscale Investments have compromised on some of the SEC’s demands.
The "Cash-Only" model is one of the key demands made by the SEC for Spot Bitcoin ETFs. Most applicants have since made the amendments needed, but a few have also criticized the demand. The director of the asset management firm Vaneck, Gabor Gurbacs, has labeled the SEC’s "Cash-Only" model as “nonsense.” Georgetown University professor James Angel has blasted the Commission for ignoring the benefits of an “In-Kind" model.
The SEC and the Dominance of Democrats
The Matrixport report explains why the SEC is unlikely to approve the applications before Q2 2024:
"The current five-person voting commissioners' leadership is critical for the ETF approval as the SEC is dominated by Democrats. SEC Chair [Gary] Gensler is not embracing crypto in the US, and it might even be a very long shot to expect that he would vote to approve Bitcoin Spot ETFs."
The report has indicated that Gensler is less inclined to approve a Spot Bitcoin ETF because doing so would legitimize BTC as an alternative store of value.
Matrixport, which recently predicted a BTC price breakout in January, said it sees the value dipping “by -20% very quickly and falling back to the USD 36,000/38,000 range” should the SEC refuse to approve the applications.
The Matrixport report cautions that the SEC’s failure to approve applications by January 5 could result in a steep decline in price. The report has advised investors to consider hedging with options.
“Matrix on Target recommends that traders hedge their long exposure by buying the USD 40,000 strike puts for the end of January or even going outright short Bitcoin through options,” the report said.
Some observers were quick to underscore the fact that the last report of the crypto platform predicted the price of BTC to top USD 50,000 in January after Matrixport released its latest report.
What is your take on Matrixport’s latest BTC price prediction? Please share your thoughts and opinions in the comments section below.
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