Bitcoin spot ETF approved, the hidden truth of the market behind it

Against the background of the ups and downs of the Bitcoin market, the recent news that the SEC (U.S. Securities and Exchange Commission) approved 11 Bitcoin spot ETFs was like a bombshell, instantly igniting the enthusiasm of investors. People are expecting that this will bring a strong rise in the price of Bitcoin. However, surprisingly, despite the market's high expectations for this news, the price of BTC did not rise as expected, but instead showed a downward trend. Why is this? What complex market factors and psychological trends are hidden behind this phenomenon?

First of all, it is worth noting that the approval of the ETF itself is not the only driving force behind the rise in Bitcoin prices. Although the launch of the Bitcoin spot ETF is widely regarded as a sign of legalization and mainstreaming, allowing more traditional investors to participate in the Bitcoin market, the market's reaction is not always consistent with expectations. Many investors may have made advance arrangements before the ETF was approved, resulting in a market psychology of "buy news and sell facts". This phenomenon is not uncommon in financial markets, especially after major news releases, investors tend to trade according to their own expectations rather than relying solely on the impact of the event itself.

In addition, the overall market environment has also had an important impact on Bitcoin prices. Recently, the uncertainty of the global economic situation has intensified, and many investors have chosen a more cautious investment strategy in the face of high inflation and economic slowdown. In this case, many investors may transfer funds from high-risk assets to more stable investment products, further increasing the downward pressure on Bitcoin.

From a technical perspective, BTC's price trend also appears to be quite complicated. Although the approval of the ETF has brought a short-term buying boom, as prices fluctuate, the market has also seen some technical sell signals, further exacerbating the price decline. For example, many technical analysts pointed out that Bitcoin has failed to stabilize effectively at certain key support levels, leading to further selling pressure. These technical factors and market sentiment are intertwined, making it difficult for Bitcoin prices to maintain an upward trend in the short term.

While deeply analyzing the Bitcoin market, we cannot ignore the performance of other cryptocurrencies. Unlike Bitcoin, many altcoins have rebounded significantly after the ETF was approved. Behind this phenomenon, it reflects the diversified strategy of investors in selecting assets. Many investors may turn their funds to relatively small but potential cryptocurrencies in search of higher returns. This change in capital flow has also affected the price performance of Bitcoin to a certain extent.

In this era of information explosion, investors have a variety of channels to obtain information, which has also led to information asymmetry in the market. For ordinary investors, how to identify the true value and trend in the complex information is a very challenging task. Therefore, when facing the news of the approval of the Bitcoin spot ETF, investors need to combine the overall market environment and their own investment strategies for comprehensive analysis in addition to paying attention to the price trend itself.

At the same time, changes in regulatory policies have also affected market expectations to a certain extent. Although the SEC has approved 11 Bitcoin spot ETFs, there is still uncertainty in the market about the direction of future regulatory policies. In this case, investors tend to be cautious about the market and may even be in a wait-and-see mood. This uncertainty will undoubtedly suppress the price of Bitcoin to a certain extent.

In the current market environment, investors need to look at the price fluctuations of Bitcoin rationally. As an emerging asset, the price of Bitcoin is affected by many factors, including market supply and demand, investor sentiment, technical trends, and the macroeconomic environment. Therefore, short-term price fluctuations do not necessarily reflect the true value of Bitcoin. When investing, investors should focus on long-term trends rather than short-term price fluctuations.

In this context, individual investors can consider adopting more flexible investment strategies. For example, diversified investment can effectively reduce risks, and fixed investment strategies can also help investors steadily accumulate assets in market fluctuations. In addition, a reasonable stop-loss strategy can help investors stop losses in time when the market shows an unfavorable trend and protect their investment returns.

In general, the news that the SEC approved 11 Bitcoin spot ETFs has undoubtedly injected new vitality into the market, but this does not mean that the price of Bitcoin will inevitably rise. Faced with a complex market environment and changing investor sentiment, rational analysis and cautious investment are the wisest ways to deal with market fluctuations. In the days to come, as the market continues to develop, investors also need to continue to learn and adapt in order to seize opportunities and obtain greater returns on investment in this field full of opportunities and challenges.

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Coin Circle (120BTc.CoM): Big news! According to Bloomberg ETF analyst James
Seyffart's instant post, the U.S. Securities and Exchange Commission (SEC) has approved 11 Bitcoin spot ETFs including Grayscale, 21Shares & ARK, BlackRock, Bitwise, Valkyrie...

Previously, the SEC's approval of the Bitcoin spot ETF's document may be temporarily inaccessible due to the surge in traffic, which once made the community worry that there was still suspense, but after about 05:30 in the morning, it can be browsed again. At that time, James
Seyffart said: I can confirm that I downloaded the document from the SEC's official website. This is an approval order. Assume that the SEC will reissue it soon.

Multiple issuers have officially announced

According to Grayscale's official press release, they also confirmed that they have obtained SEC approval, and GBTC is expected to start trading on NYSE Arca on January 11, 2024, Eastern Time.

"We appreciate the SEC's careful review of our application and look forward to the next chapter of GBTC. It is certain that Grayscale will continue to be a leading partner and trusted resource for analysts, investors, financial advisors, institutions, and those interested in exploring investments in Bitcoin and crypto asset classes."

VanEck, one of the applicants for the Bitcoin spot ETF, also confirmed that the Chicago Board Options Exchange (CBOE) has obtained approval from the U.S. Securities and Exchange Commission (SEC) to list a spot Bitcoin ETF.

Six of the ETFs will be listed on the Chicago Board Options Exchange (CBOE), three will be listed on the New York Stock Exchange (NYSE), and two will be traded on the Nasdaq.

BTC falls below the 46,000 mark

However, in terms of the price performance that investors are most concerned about, BTC was not incentivized to rise, but fell below the $46,000 mark. The trading volume and volatility were not even as large as when the SEC released false news yesterday, which is quite interesting.

At the market psychological level, investor sentiment often has a direct impact on price trends. As a highly volatile asset, Bitcoin's price is driven by market sentiment. Although the news of ETF approval has inspired investors' hopes, it may also trigger a panic. Many investors may worry that the market has fully digested the news and that there is limited room for subsequent price increases, so they choose to lock in profits when prices fall back, which in turn leads to price declines.