The Fear of Bitcoin ETF Denial Triggers a Sudden Price Drop for Bitcoin, Ethereum, XRP, and Solana, Termed as the ‘Rug Pull of the Decade’ 2024 starts

10 months ago 3

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Bitcoin and crypto prices—including ethereum, XRPXRP 0.0% and solana—have suddenly crashed as fears swirl that the huge Wall Street bid for a bitcoin spot exchange-traded fund (ETF) could be denied.

The bitcoin price has dropped around 10%, while ethereum, XRP and solana are all down between 8% and 15% following an analyst prediction the U.S. Securities and Exchange Commission (SEC) will push a decision on a BTC spot ETF back to the next quarter.

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“SEC chair Gensler is not embracing crypto in the U.S., and it might even be a very long shot to expect that he would vote to approve BTC spot ETFs,” Matrixport analyst Markus Thielen wrote in a report first seen by The Block. “This might be fulfilled by Q2 2024, but we expect the SEC to reject all proposals in January.”

Expectations have soared in recent weeks that a long-awaited BTC spot ETF could be approved, with leaks trickling out from meetings between Wall Street giants and the SEC. This week, a BlackRock leak suggested the SEC could approve a bitcoin spot ETF by the end of the week.

“From a political perspective, there is no reason to approve a bitcoin spot ETF that would legitimize bitcoin as an alternative store of value,” Thielen wrote, adding the bitcoin price and crypto market could crash “if there is any denial by the SEC.”

“We could see cascading liquidations as we expect most of the $5.1 billion in additional perpetual long bitcoin futures to be unwound,” Thielen wrote. “We could see bitcoin prices declining by -20% very quickly and falling back to the $36,000/$38,000 range.”

Other bitcoin and crypto market watchers have also expressed growing fears the SEC could reject the bitcoin spot ETF bid following the agency’s failure to make an announcement in the first few days of January, as some had expected.

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“This would be the rug pull of the decade,” Bloomberg ETF analyst Eric Balchunas, told Cointelegraph. “Everybody put in a lot of work in this, especially over the holidays. Sadistic might not even be strong enough a word for it.”

“A lot of people are getting nervous that the ETF could be delayed,” Ran Neuner posted to X. “The BTC 0.0% ETF was a trade,” Neuner added. “Now we are days away from the end of that trade.”

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