Bitcoin ETF Speculation Sustains Bitcoin Price – How Long Will it Last?
The Bitcoin price
has seen substantial volatility in recent weeks, largely driven by speculation around the potential approval of a Bitcoin exchange-traded fund (ETF) by the SEC. While Bitcoin bulls have cheered each new rumor of progress on the ETF front, whether the asset can sustain significant price increases in the long run solely based on ETF speculation and hype, is still a point of debate.
Last week, Bitcoin prices rose 10% intraday on October 16 following an unconfirmed rumor that the SEC had already greenlit a spot Bitcoin ETF from BlackRock. The rumor proved false, and Bitcoin pulled back from its brief spike once traders realized no actual ETF approval had occurred yet, however.
This week, Bitcoin experienced a similar double-digit percentage price boost based on reports that the SEC is finally preparing to allow spot Bitcoin ETFs, with potential approval coming by year-end.
The emergence of this narrative has excited Bitcoin traders, helping the cryptocurrency gain over 100% in value since the beginning of 2023. Bitcoin is still far below its all-time high near $69,000 reached in November 2021, however.
BREAKING: rumors are circulating that approval of a #Bitcoin ETF is expected within 24 hours.
— BITCOINLFG® (@bitcoinlfgo) October 27, 2023
The key question now is how long this momentum can persist if Bitcoin ETF approval continues to stay elusive. Once the long-awaited ETF finally arrives and the initial thrill fades, the risk of diminished support and fading hype certainly exists.
Some insight can be gleaned by examining the market’s reaction to the launch of Bitcoin futures ETFs in 2021. Many traders anticipated those ETFs would greatly boost mainstream adoption. Demand was largely concentrated within the
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