Analysts expect that all pending requests for immediate-traded Bitcoin ETFs could receive approval in the second quarter of 2024.
Therefore, I believe that the price of Bitcoin will decline to $36,000 or $38,000 in the current January, as buying options are expected to strengthen at those levels.
Additionally, the chairman of the regulatory body, Gary Gensler, does not support cryptocurrencies in the United States, making it unlikely for him to vote in favor of approving immediate-traded Bitcoin ETFs.
In the past few hours, the price of Bitcoin took a strong hit, starting Thursday’s trading at $43,057, following a sudden drop in prices that was merely a reaction to investor fear and panic after a report from Matrixport. The report took a negative stance on Bitcoin’s price and ETF approval at a time when prices were heading towards $50,000.
The report, titled “Why the Securities and Exchange Commission Will Reject the Upcoming BTC ETF Applications,” contradicted the market’s upward trend, causing a 6.5% decline.
The report also suggested that the collapse could erase $5.1 billion from added buying deals due to news of the Securities and Exchange Commission’s approval of ETFs theoretically. This move is expected to lead to a 20% decrease in the price of Bitcoin, reaching between $36,000 and $38,000.
The approval date is still scheduled between January 8 and 10, essentially meaning that reports indicating otherwise are likely unreliable. So, will the cryptocurrency market decline further?
Here, I say that the 365-day Market Value to Realized Value (MVRV) ratio is currently 33.15%, indicating that 33.15% of investors who bought Bitcoin in the past year have made profits. If these investors decide to cash in their profits, it could trigger another short-term collapse.
This expected collapse could be just the beginning, especially if Matrixport’s expectations of the Securities and Exchange Commission rejecting ETFs are correct. In the case of rejection until the second quarter of 2024, Bitcoin prices may repeat the price movement of 2019 and possibly trigger a sharp decline.
From my perspective, in the event of rejection of exchange-traded funds, the worst-case scenario could see Bitcoin reaching the crucial level of $30,000 and possibly the bottom near $24,800 in the medium term.
However, I believe that with time and an increasing likelihood of approval in the coming days, there is a significant opportunity for the price of Bitcoin to regain the $45,000 level and rise further in the short term.