Are you curious about the recent turbulence in the Bitcoin market? It appears that the catalyst behind the 7% drop in Bitcoin’s value, which saw it plummet as low as $41,804.95 before making a slight recovery, is a report from digital asset manager Matrixport. The report, ominously titled “Why the SEC will REJECT Bitcoin Spot ETFs again,” triggered a wave of panic across the market.
Matrixport’s Report and Its Impact
The report, authored by Matrixport’s Head of Research, Markus Thielen, suggested that none of the Bitcoin Exchange-Traded Fund (ETF) applications would receive approval in January. This prediction, combined with the possibility of these applications being ready for approval in the first half of 2024, did little to alleviate market concerns.
According to Matrixport, the Bitcoin ETF hype has resulted in at least $14 billion entering the cryptocurrency markets. This means that many traders who were bullish on Bitcoin have been liquidated. Coinglass reports that in the past day alone, $576 million worth of long positions were liquidated, with $553 million of that happening within the last 12 hours.
Analysts’ Reactions to the Report
Vetle Lunde, a senior analyst at K33 Research, concurred that the Matrixport research seemed to be the trigger for the market crash. However, he disagreed with the forecast that the SEC would reject all pending Bitcoin ETF applications, saying, “This opinion is going against consensus. Based on Grayscale’s court win, and all back-and-forth between the SEC and issuers leading to updated S-1s and cash creations, a denial seems highly unlikely.”
The report also sparked debates among analysts on social media platforms. Bloomberg Intelligence analyst Eric Balchunas questioned the basis of Thielen’s predictions, citing a previous tweet from Thielen himself predicting SEC approval in early 2024.
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