The price of Bitcoin has experienced a slowdown recently after an impressive week of surpassing critical resistance levels. Despite this, many experts believe that this rally is just getting started, and Bitcoin is poised to see further gains in the coming months. As of now, the cryptocurrency is trading at $43,300, reclaiming levels last seen in 2022 before the crash to its yearly lows.
In the weekly chart, Bitcoin has recorded a remarkable 15% rally, with Ethereum following suit while other altcoins have lagged behind. This surge in Bitcoin’s value is attributed to the anticipation surrounding the approval of a spot Bitcoin Exchange-Traded Fund (ETF) by the U.S. Securities and Exchange Commission (SEC).
According to a recent market update by QCP Capital, Bitcoin’s year-to-date gain stands at an impressive 260% due to this exponential rise. The SEC’s announcement that January 5th, 2024, will be the final deadline for rebuttal comments sets the stage for a potential approval in the following week. Although the SEC might not grasp the significance of Bitcoin’s Genesis block anniversary on January 3rd, 2024, the market has certainly taken note.
As Bitcoin edges closer to the $45,000 mark, investors are evaluating how much of this news has already been factored into the current price. The post-ETF approval period will be crucial as the actual impact depends on the flows from the ETF in its initial trading weeks. If expectations do not align with reality, a “sell-the-news” event might occur next year.
Asian Buyers and the Traditional Finance Ecosystem
The SEC’s announcement on December 1st has rekindled the interest of Asian buyers who had been less active in the previous month. Interestingly, most of the recent gains in Bitcoin’s value have occurred during U.S. trading hours, showcasing increasing investor activity in anticipation of the SEC announcement.
As the market gears up for the spot ETF launch, investors have a multitude of options to choose from. With 13 applications for spot ETFs and several others for leveraged and options-based ETFs in the pipeline, the traditional finance ecosystem surrounding Bitcoin (and soon Ethereum) is set for significant expansion. This expansion could pave the way for structured products becoming a key asset class, similar to the role they play in other markets like gold.
QCP Capital predicts that even if spot BTC reaches its peak on the launch day itself, it will not hinder the anticipated boom of the Traditional Finance ecosystem surrounding Bitcoin and Ethereum. This development has been anticipated and discussed by experts for years, and it seems that the time has come for it to unfold.
Amidst Bitcoin’s dominance, the altcoin sector is making efforts to catch up with the ongoing rally. The current pullback in Bitcoin’s price could present an opportunity for smaller coins to benefit from the bullish momentum. However, the question remains: how much longer will altcoins trail behind before making their move? The total altcoin market capitalization is still in the process of playing catch-up, indicating that there might be significant potential for growth in this segment.
The current rally in Bitcoin’s price marks an exciting period for cryptocurrency enthusiasts and investors. With the imminent approval of a spot Bitcoin ETF and the expansion of the traditional finance ecosystem surrounding Bitcoin and Ethereum, the future looks promising. While altcoins continue their efforts to catch up, it remains to be seen when they will experience their own surge. As the crypto market evolves, it is crucial to closely monitor these developments and stay informed to seize potential opportunities.