What is a Bitcoin ETF? What is its purpose? When is the latest possible outcome? What happens if it

What is a Bitcoin ETF? What is its purpose? When is the latest possible outcome? What happens if it is rejected?

Read without laziness, understand. There is a large group of investors who are investing in the expectation of ETF approval without knowing what ETF is. Tragicomic...

🚨What is it, and what benefits does it bring to the crypto market?

A Bitcoin ETF is an exchange-traded fund based on Bitcoin. This fund tracks the price movements of Bitcoin and provides investors with the opportunity to invest in this cryptocurrency without directly purchasing Bitcoin. ETFs can be bought and sold like traditional stocks on stock exchanges, providing investors with easy and regulated access to Bitcoin. Bitcoin ETFs are particularly attractive to investors who want to enter the cryptocurrency markets but do not want to buy Bitcoin directly.

• The potential approval by the SEC allows Bitcoin to reach a broader investor base and contributes to price stability.
• For example, according to Matthew Sigel, Head of Digital Assets Research at VanEck, more than $2.4 billion in inflows are expected for newly approved US spot Bitcoin ETFs in the first quarter of 2024.
• Applications from major asset management firms such as BlackRock, ARK Invest, Bitwise Asset Management, VanEck, WisdomTree, Invesco, Galaxy Digital, Fidelity, and Valkyrie are particularly important. Approval of these applications significantly increases institutional investments in Bitcoin. However, this does not happen quickly; it takes time. So, don't expect BTC to triple in value within a month of ETF approval.
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🚨Until when can the SEC postpone Bitcoin ETF decisions?

• During the evaluation process of SEC Bitcoin ETF applications, they can defer decisions for up to 240 days. This period is calculated from the initial filing in the Federal Register.
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In 2023, VanEck became the first company to submit a Bitcoin ETF application. The date was July 2023:

• The SEC can defer spot Bitcoin ETF applications for a maximum of 240 days, meaning they can delay until March 2024 at the latest. The outcome must be announced by March at the latest.

🚨What if the SEC rejects ETF applications?

If the SEC rejects the Bitcoin ETF application, it will lead to the following consequences:

1. Market Reaction: In the short term, there will be increased volatility in the markets, causing temporary and intense selling pressure on the price of Bitcoin, and of course, Altcoins will also benefit.
2. Investor Perception: The rejection of the ETF may affect the confidence in Bitcoin for some investors, especially institutional investors.
3. Regulation Expectation: The ETF rejection will be accompanied by reasons, sparking further discussions and expectations regarding the regulation and regulation of cryptocurrency markets.