Bitcoin and other cryptocurrencies are facing a downward trend in their prices, and it seems that the volatile trading environment will persist as the approval of exchange-traded funds (ETFs) linked to Bitcoin spot trading is anticipated.
Over the past 24 hours, the value of Bitcoin has dropped by 5.1% to $43,007. Despite reaching a milestone of $45,000 on Tuesday, the largest cryptocurrency experienced a decline, dropping as low as $41,361 on Wednesday.
The majority of this drop occurred following a prediction by Matrixport, a crypto financial-services platform, on Wednesday. They suggested that the Securities and Exchange Commission (SEC) would reject all spot Bitcoin ETF applications in January.
The SEC has until January 10 to make a decision on the spot Bitcoin ETF application filed by ARK Invest and 21Shares. Although uncertainty around the ETF approval has dampened Bitcoin's rally, with a 56% increase in the last three months, market sentiment still leans towards the SEC granting approval for the funds.
According to Joel Kruger, market strategist at LMAX Group, experts and observers believe that any price fluctuations will be short-term. It is widely believed that approval for a Bitcoin ETF in the US is not a matter of if, but when.
While Bitcoin remains a focal point, there are other cryptocurrencies experiencing declines. Ethereum, the second largest cryptocurrency, has fallen by 6.2% to $2,228. Smaller cryptocurrencies like Solana have seen a drop of 9.1%, Cardano has experienced an 8.6% decline, and Dogecoin's value has decreased by 9.5%.