- Bitcoin witnessed a massive uptick in price, caused by ETF anticipation.
- Gary Gensler’s tweet further exaggerated the hype as updates were submitted by applicants.
Bitcoin [BTC] witnessed a massive uptick in the last 24 hours due to the increasing anticipation around ETFs.
Gary Gensler chimes in
The hype was intensified by tweets from SEC Chairman Gary Gensler, who tweeted a list of things retail investors should consider before making crypto investments.
While Gensler’s comments primarily advise retail investors to exercise caution, many in the market interpret them as a potential indication that the announcement of a Bitcoin ETF is imminent.
Gensler expressed concerns about how those offering crypto investments may not be complying with applicable laws in the crypto asset investment/services sector.
He also highlighted the potential lack of compliance with federal securities laws and cautioned investors about the risk of being deprived of essential information and protections in connection with their crypto asset investments.
Gensler emphasized the exceptionally risky and volatile nature of investments in crypto assets, citing instances of major platforms and crypto assets becoming insolvent or losing value.
He also warned of the ongoing exploitation of crypto assets’ rising popularity by fraudsters.
1⃣ Those offering crypto asset investments/services may not be complying w/ applicable law, including federal securities laws. Investors in crypto asset securities should understand they may be deprived of key info & other important protections in connection w/ their investment.
— Gary Gensler (@GaryGensler) January 8, 2024
Growing speculation
During an interview with CNBC on Monday, former SEC chair Jay Clayton expressed his confidence in the inevitability of ETF approvals. He emphasized that there are no remaining decisions to be made.
Clayton underscored the magnitude of this development, portraying it as a pivotal moment that extends beyond the realm of cryptocurrency. According to him, the approval represented a substantial stride forward in the evolution of finance as a whole.
Moreover, Standard Chartered released a note forecasting significant inflows ranging between $50 billion to $100 billion into the Bitcoin spot ETF in the year 2024 alone.
Additionally, the financial institution made a prediction, asserting that the price of Bitcoin is poised to surpass $200,000 by the conclusion of 2025.
ETF fees gets announced
Another factor that is making people believe in the possibility of an approval of an ETF is the publishing of ETF fees. The fee structure show highly competitive rates, some below operational expenses.
Issuers prioritize market share over short-term profits, anticipating a surge in future demand for the Bitcoin market.
$BTC ETF Fees have just been released.
With extremely competitive management fees, some even below operating costs, issuers prioritize market share over short-term profits, likely in anticipation of a substantial influx of future demand for the $BTC market.
Additionally, with… pic.twitter.com/xDHRKxkbWv
— An Ape's Prologue (@apes_prologue) January 8, 2024
Analysts make a statement
Despite these positive indicators implying that the ETF approval is certain, there were some who believed that there could be a delay in the works. This was due to the fact that the SEC recently issued additional comments on pending applicant’s S-1s.
However, James Seyffart, an ETF analyst, responded to the FUD by providing several insights.
Firstly, he acknowledged the accuracy of comments on the S-1 documents.
Balchunas, another ETF analyst, also anticipated the likelihood of witnessing more amendments in the following day due to the current developments. However, despite these observations, he expressed his belief that this doesn’t necessarily indicate a signal of delay.
1. This is true, comments came back on those S-1 documents with the fees that we all went crazy over this morning (this isn't out of ordinary)
2. Expect to see more amendments tomorrow because of this
3. That said — I don't think this is necessarily a delay signal https://t.co/o2m0lIBSct— James Seyffart (@JSeyff) January 9, 2024
A tale of S-1s and S-3s
At press time, Valkyrie, Wisdomtree, Invesco/Galaxy, iShares, Ark/21Shares, and Vaneck had filed updated S-1 filings for Bitcoin spot ETFs with the SEC.
Grayscale submitted a revised S-3 document. The proposed ETF fee for the spot Bitcoin ETF is 1.5%, and liquidity providers include JANE STREET, VIRTU, FLOW TRADERS, and FLOWDESK.
For context, S-1 filings detail a company’s plans for an initial public offering (IPO), while S-3 filings pertain to securities offerings and business updates.
