Published: Sat, August 11, 2018
Markets | By Otis Pena

BTC Mid-Week Analysis: Bitcoin Crashes as SEC Postpones Decision on Bitcoin ETF

BTC Mid-Week Analysis: Bitcoin Crashes as SEC Postpones Decision on Bitcoin ETF

The United States Securities and Exchange Commission (SEC) has postponed its decision on the Bitcoin ETF filing submitted by VanEck and SolidX. The fund the US SEC is considering is from the investment firm VanEck and the financial services company SolidX Bitcoin Trust, which will list on the CBOE BZX Equities Exchange. It targeted September 30 as the date on which it will either approve or disapprove the CBOE rule change that would allow the ETF.

The latest Bitcoin news is that Bitcoin (BTC) has taken a major hit this week and has dragged the rest of the cryptocurrency market down with it.

During an appearance on CNBC's Fast Money on Wednesday, Pantera Capital CEO Dan Morehead suggested that Bitcoin investors have been too focused on attempts to gain approval for a Bitcoin ETF.

Looking more at the charts, price attempted to break back above the 100-hour MA (red line) yesterday but failure to do so and the SEC news has resulted in Bitcoin moving lower into support at $6,500.

For instance, a bitcoin ETF application was submitted merely two weeks ago by the Winklevoss Twins of the Gemini Exchange in NY. After reaching a high of $20,000 last December, the price of Bitcoin has fallen unceremoniously.

In general, the SEC has the power to postpone specific decisions if it considers that the proposal is controversial. "The SEC has been very cautious with an ETF". "The SEC is likely to delay until February of 2019 and the chances of a Bitcoin ETF approval in 2018 have always been low".

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As of press time, the price of bitcoin has not reacted, trading at around $7,060 according to the CoinDesk Bitcoin Price Index (BPI).

At time of writing, the total market cap is at $221,803,776,183 (4pm, ET), down about 11 per cent in 24 hours. Its market capitalization is $112 billion dollars. These are certainly amongst the most important decisions regarding the further development of the cryptocurrency markets.

ETF's are seen as a way for institutional investors to get into cryptocurrency investing in a safer way than buying bitcoin on a crypto-asset exchange.

If the ETF is approved, Bitcoin might fly.

Furthermore, citing the SEC's "concerns regarding bitcoin ETFs and retail investors", the presentation notes that "the initial share price will be set at a level created to ensure that only institutional and "non-retail" investors will be able to purchase shares", which is a price per share of $203,750 as of July 30.

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