The ‘Rug Pull Of The Decade’—Bitcoin ETF Denial Fears Suddenly Crash The Price Of Bitcoin, Ethereum, XRP And Solana in 2024

“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 BTC spot ETF by the end of the week.

“From a political perspective, there is no reason to approve a BTC spot ETF that would legitimize BTC as an alternative store of value,” Thielen wrote, adding the BTC 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 BTC futures to be unwound,” Thielen wrote. “We could see BTC prices declining by -20% very quickly and falling back to the $36,000/$38,000 range.”

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

The BTC price has fallen sharply, dragging down the price of ethereum, XRP, solana and the wider … [+]

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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 ETF was a trade,” Neuner added. “Now we are days away from the end of that trade.”