January 10th. That is the closest deadline for when the U.S. Securities and Exchange Commission (SEC) could pass a Bitcoin (BTC) spot ETF. This is what has caused the market to be in such a frenzy as investors and enthusiasts are all holding their breaths for what’s to come.
Last time on Thunder Buzz, we talked about Bitcoin’s hype ahead of 2024, and a big part of it is due to the spot ETF. The SEC’s decision in the next couple of days could map out Bitcoin’s growth trajectory for the year. Let’s talk about that.
The Significance of the Bitcoin Spot ETF
Previously, we discussed a little bit about the significance of the BTC spot ETF, and we’ll go deeper into that today. So what exactly does the BTC spot ETF bring to the table? It is a titanic amount of exposure.
This is exposure for Bitcoin to an audience that either heard of Bitcoin but found it too much of a hassle to trade or has never heard of the popular cryptocurrency in the first place. This taps into the potential for traditional investors to take part in “trading” BTC and familiarizing themselves with cryptocurrency. While there are many arguments as to whether this is good for the landscape as a whole, it can’t be denied that one of the first steps toward mass adoption is familiarization, and that’s what the spot ETF can bring.
This boost in exposure will most likely lead to an influx of those trading BTC and with it, changes in the price. As more eyes are directed to BTC, the significance and value of the asset will, more likely than not, increase. It is precisely this potential for value increase that’s got all the crypto enthusiasts so worked up, so much so that a single article from a mainstream news outlet on whether the spot ETF will pass can cause massive spikes or drops. This potential rise in value for BTC can influence the entire market and can offer growth for other cryptocurrencies as a rising tide lifts all ships.
As a gateway for Bitcoin to reach further into parts outside the Web3 world, the SEC’s decision on the spot ETF will surely bring about some major changes. All that’s left for us is to wait and see.
What Will Happen If It Passes?
For one thing, we will see tons of articles on it, some calling for Bitcoin to go 100k and others saying it’s all a scheme. This will undoubtedly lead to varying responses from investors, resulting in fluctuations in the price. It’s impossible to say whether prices will rise or drop, but what is definite, however, is the fact that Bitcoin will have more attention on it than it has for a while. Increased engagement in the asset is generally a good sign.
The passing of Bitcoin’s spot ETF could also open the path for another cryptocurrency to follow suit. What about an Ethereum spot ETF? As the queen to the king that is Bitcoin in the crypto market, would it be so crazy for talks about Ethereum spot ETF to start surfacing? And if that follows suit, why not the others? Should the spot ETF pass for Bitcoin, it could very well lead to a new era for the Web3 world.
It should also be noted that an increase in attention garnered could also mean more development in terms of regulations in crypto trading. As crypto walks closer in line with traditional investing, it’s only logical for institutions to want to set regulations for security and control. This will put many networks and exchanges to the test as things are tidied up so that the landscape is more secure and friendly for users. Development of any kind will help crypto go a long way in being mass-adopted.
Overall, should the spot ETF pass, it seems likely that it will mean very positive things for the entire market as well as for the development of the Web3 world.
What Will Happen If It’s Denied?
But what if it’s denied again? This is certainly a fear that many have, but the impact is most likely much less than one would think. For one thing, Bitcoin’s value isn’t one fully built upon whether this ETF passes. It might see drops but a total collapse is very unlikely, and as Bitcoin has weathered many drops in the past, it always rises back up.
Another thing to note is that the SEC denying current applications will not mean this is the last shot for it. All it will mean is that there’s still room for crypto development before the SEC will accept it. This simply means that by the time the SEC is ready to pass the spot ETF, we will have more complete products and a better-developed ecosystem.
Things to Watch Out For
Regardless of whether the spot ETF passes or not, crypto investors and enthusiasts should all closely observe the market and different media sources for the next few weeks, even months. We will likely be seeing shifts in the market for Bitcoin and other altcoins so it’ll be a turbulent period that can present many opportunities. Media sources will all be trying to direct sentiment to influence the market, so it’ll be worth noting who is saying what.
Another thing to be noted is that Jan. 10th is the deadline for Ark and 21Share’s spot ETF application with BlackRock’s being Jan. 15th. Many think that if the BlackRock application is set to be passed, so will the others, marking the expectation that Jan. 10th will be the pivotal date. March 31st will be the last known deadline for a spot ETF to be passed (For Hashdex and Franklin Templeton’s applications)!
The excitement is in the air so watch out for the verdict!
What’s Next?
We will continue to talk about the hottest topics in future Thunder Buzz articles! Also, watch out for part two of ThunderCore’s 2023 recap as well as the next Thunder Academy where we will talk about getting into crypto in 2024! Until next time, Thunders!
ThunderCore Official