Bitcoin price drop extends as SEC delays decision and opens comment period on options trading on spot BTC ETFs
- Bitcoin price rejection from $65,000 resistance continues after failure to reclaim it as support.
- Liquidity pool below $60,000 continues to act as magnet for BTC toward proper market balance.
- US SEC has delayed decision and opened comment period on whether or not to allow options trading on spot BTC ETFs.
Bitcoin (BTC) price is recording lower highs on the weekly timeframe, with altcoins now in disarray. Perhaps a big news could help push the price higher as the king of cryptocurrency lateralizes. In the latest, markets still do not know whether spot BTC ETFs will be allowed for options trading.
Also Read: Bitcoin price downside momentum grows, BTC bulls wait to buy BTC under $63K level
Daily digest market movers: SEC delays decision and opens comment period on options trading on spot Bitcoin ETFs
The US Securities & Exchange Commission (SEC) has delayed a decision on whether or not to allow options trading on spot BC ETFs. It basically means that they need more time to review and analyze the proposal.
The SEC may have concerns about potential risks, market manipulation or other regulatory issues associated with introducing options trading on these ETFs.
JUST IN: SEC delays decision and opens comment period on whether or not to allow options trading on spot #Bitcoin ETFs. pic.twitter.com/W7Kv3uAzaY
— Bitcoin Magazine (@BitcoinMagazine) April 25, 2024
Options are financial derivatives that give buyers the right, but not the obligation, to buy or sell an underlying asset at an agreed-upon price and date.
Delays in such decisions are common as the financial regulator works to ensure investor protection and market integrity.
Alongside the delay, it has opened a comment period but in the meantime markets will be keen to wait for further updates from the SEC or the relevant parties involved in the proposal to understand the reasoning behind the delay and any potential implications for investors.
Meanwhile, data according to on-chain market intelligence firm Glassnode shows the Bitcoin network hash rate is still rising, which points to ongoing investments in mining infrastructure.
A strong mining hash rate is crucial for Bitcoin's security, making network attacks more challenging.
BTC hashrate growth
Crypto ETF FAQs
An Exchange-Traded Fund (ETF) is an investment vehicle or an index that tracks the price of an underlying asset. ETFs can not only track a single asset, but a group of assets and sectors. For example, a Bitcoin ETF tracks Bitcoin’s price. ETF is a tool used by investors to gain exposure to a certain asset.
Yes. The first Bitcoin futures ETF in the US was approved by the US Securities & Exchange Commission in October 2021. A total of seven Bitcoin futures ETFs have been approved, with more than 20 still waiting for the regulator’s permission. The SEC says that the cryptocurrency industry is new and subject to manipulation, which is why it has been delaying crypto-related futures ETFs for the last few years.
Bitcoin spot ETF has been approved outside the US, but the SEC is yet to approve one in the country. After BlackRock filed for a Bitcoin spot ETF on June 15, the interest surrounding crypto ETFs has been renewed. Grayscale – whose application for a Bitcoin spot ETF was initially rejected by the SEC – got a victory in court, forcing the US regulator to review its proposal again. The SEC’s loss in this lawsuit has fueled hopes that a Bitcoin spot ETF might be approved by the end of the year.
Technical analysis: Bitcoin price drawn to liquidity pool below $60,600
From a technical standpoint, Bitcoin price continues to get rejected from the $65,600 resistance level. It comes after multiple failed attempts to reclaim above it and flip the level into support.
Accordingly, the pioneer cryptocurrency has been producing downside wicks, drawn toward the pool of liquidity that exists between the $60,600 and $60,000 psychological level.
As this has happened for multiple weeks now, enhanced profit booking could see Bitcoin price dip into the said liquidity pool. This will happen if the Relative Strength Index (RSI) continues to record lower highs, effectively pulling toward the 50 mean level.
The Moving Average Convergence Divergence (MACD) is also hinting at a downtrend, pending confirmation when it will cross below the orange band of its signal line. If it does, it would signify a potential change in the direction of BTC price movement.
This would mean that the short-term momentum is shifting to the downside and that a potential downtrend may be forming. Traders are likely to sell or take a bearish position on BTC when this happens, which would enhance the downtrend.
In a dire case, Bitcoin price could slip below the liquidity pool under the $60,000 psychological level, with the next line of support presented by the 50-day Moving Average (MA) at $54,689. A deviation of this lagging indicator to the downside would signal an extended fall.
BTC/USDT 1-week chart
Conversely, if the bulls leverage the ongoing correction as a buy-the-dip opportunity, Bitcoin price could recover. Key levels to watch in a northbound directional bias would be the $65,596, $69,032, and $71,311 levels.
A candlestick close above here on the weekly timeframe would pave the way for BTC to reclaim its peak price of $73,777, which would lay the groundwork for a new all-time high above it.
Author
Lockridge Okoth
FXStreet
Lockridge is a believer in the transformative power of crypto and the blockchain industry.
