The SEC, the United States’ financial regulator, will not authorize many managers to create exchange-traded funds (ETFs) linked to the world’s most widely used cryptocurrency, as Bitcoin falls 4% to close to $43,000 this Wednesday.
At the close of markets in the United States, bitcoin, which fell 10% to around $42,850, was a far cry from yesterday’s close of $45,127 and the $45,908 it reached during Tuesday’s session.
The setback comes just a day after Bitcoin regained the $45,000 level, a level the price had not crossed since April 2022.
Volatility is dominant in the behavior of this cryptocurrency, as its price ranged between $45,500 and $40,970 during today’s trading session.
Analysts attributed today’s decline to the possibility that the US Securities and Exchange Commission (SEC) will not finally approve the creation of an ETF linked to the spot price of bitcoin in January.
In fact, one of the factors cited by analysts to explain bitcoin’s recovery in recent weeks was the belief that the SEC would authorize ETFs this month.
Diego Morin, from IG, associates today’s fall with a report published on the Matrixport cryptocurrency platform in which analyst Marcus Thielen expects the SEC’s rejection of bitcoin-linked ETFs.
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Contrary to market consensus, Thielen maintains in his report that the applications do not yet meet the necessary requirements for the SEC to approve them.
Thielen leaves open the possibility that these demands could be met in the longer term, particularly in the second quarter, although he now favors a rejection of the ETF in January.
Analysts also linked the recovery in the price of bitcoin, which has now been cut, to the proximity of the new half (a reduction in the reward received by “miners” of this cryptocurrency), initially scheduled for April.
Unlike what happens with central banks, Bitcoin is created in a decentralized manner through a process known as “mining”.
“Miners” are users who process transactions using specialized computer equipment and who receive bitcoins in exchange for their services.
With information from EFE
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