Bitcoin ETF Approval — Short Term Drag on Prices, but Long Term Gain?

Contents

Bitcoin ETF won’t benefit cryptocurrency – JPMorgan
CONTENT

  • Bitcoin ETF won’t help cryptocurrency price

  • The emergence of an exchange-traded bitcoin fund will affect the Grayscale monopoly

  • Bitcoin is undergoing a 20% correction

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The emergence of an exchange-traded bitcoin fund could negatively affect the price of cryptocurrency, experts at JPMorgan Bank say

An exchange traded fund (ETF) focused on bitcoin could be bad for the future of cryptocurrency prices. Bloomberg reports about it with reference to the analysts of the American bank JPMorgan.

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The bank believes that the emergence of a Bitcoin ETF will affect the leadership status of the Bitcoin Trust (GBTC) from Grayscale Investments. The outflow of funds from the ETF trust will reduce the Grayscale premium to net worth, which, in turn, may affect the price of bitcoin, according to JPMorgan.

“The rapid outflow of [bitcoin from] GBTC and the fall of its premium is likely to have negative short-term consequences for bitcoin, given the capital inflows and the importance of GBTC [for cryptocurrency],” analysts noted.

The cryptocurrency community believes that a change in leadership at the US Securities and Exchange Commission (SEC) could lead to the long-awaited emergence of Bitcoin ETF.

Bitcoin ETF won't benefit cryptocurrency - JPMorgan

It is noteworthy that the ex-chairman of the SEC Jay Clayton himself previously announced the efforts of the regulator to create a regulatory framework for the legalization of crypto ETFs.

Belated salvation

However, not everyone believes that the Bitcoin ETF will somehow affect the development of the cryptocurrency. According to the creator of the Litecoin cryptocurrency, Charlie Lee, Bitcoin ETF will not cause a bullish leap due to loud quantitative easing fueled by the US government.

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On Monday, January 11, the price of the leading cryptocurrency by market cap in the BTC / USDT trading pair is experiencing a loud drawdown. Bitcoin stopped falling at $ 32,538 (-20%) and at moment of writing the price is $ 35 702.

Bitcoin ETF won't benefit cryptocurrency - JPMorgan

Bitcoin capitalization also decreased from $ 764 billion to $ 633 billion (- $ 131 billion).

At the same time, according to Grayscale Investments U.S. pension funds, have tens of trillions of dollars under their control and are interested in investing in bitcoin.

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Bitcoin ETF won't benefit cryptocurrency - JPMorgan

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