Bitcoin Price Recovery Continues As Investor Excitement Grows

Key Points:

• The Bitcoin price recovery took place after a 9.2% dip triggered by concerns over the potential rejection of ETFs by US regulators.
• Bloomberg estimates a 90% chance of the SEC approving Bitcoin ETFs by January 10, causing market volatility amid anticipation.
• Social media buzz grows over a rumored SEC decision on a spot Bitcoin ETF by Friday, with analysts expecting approval between January 8 and 10.

Bitcoin price recovery has happened, regaining lost ground from a recent flash crash, as investors lifted off concerns about the potential rejection of exchange-traded funds (ETFs) by US regulators.

Bitcoin Price Recovery Overcomes Flash Crash Amid Regulatory Speculation

According to Bloomberg, Bitcoin faced a 9.2% intraday drop on Wednesday, triggered by Matrixport analyst Markus Thielen’s note predicting the Securities and Exchange Commission’s (SEC) rejection of all Bitcoin ETF proposals this month.

Despite the setbacks, Bloomberg Intelligence analysis suggests a 90% probability of SEC approval for the ETFs by January 10. The market’s spike in volatility comes from heightened anticipation around ETF approval, as evidenced by the sharp Wednesday decline.

Matthew Hougan, Chief Investment Officer at Bitwise Asset Management, noted, “The market is keenly focused on the potential for an ETF approval, so even small whiffs of news can cause relatively big market moves as leveraged positions get stopped out.”

Speculation on social media has accelerated ahead of a rumored SEC decision on a spot Bitcoin ETF by Friday. Bloomberg ETF analyst James Seyffart dismisses the January 5 speculation as “noise,” expecting approval between January 8 and 10. The Bitcoin price recovery will likely be reinforced if the news is confirmed before this time.

Senior Bloomberg ETF analyst Eric Balchunas indicated that the SEC is in the final stages of providing comments, with issuers set to submit their final 19b-4 and S-1 forms shortly. Approval of both forms by the SEC is necessary before the ETFs can begin trading, with the 19b-4 form pivotal for the spot Bitcoin ETF’s effective approval.