Cryptocurrency market analysts name the main reason for the fall of major digital assets

A recent report by Matrixport analysts, which was written by Chinese cryptocurrency and blockchain researcher Colin Wu, states that the US Securities and Exchange Commission (SEC) will reject all applications to launch spot bitcoin ETFs in January this year. According to analysts, the final approval may be obtained in the second quarter of 2024. Experts have predicted a drop in the BTC rate to $ 36,000.

The researchers also believe that after the approval of spot BTC ETFs, the flagship cryptocurrency BTC $56,457.80 Bitcoin -2.47% Market capitalization $1.11 trillion VOL. 24 hours $4.48 billion may rise to $ 50,000 this month. However, experts are confident that all submitted applications do not fully meet the most important SEC requirements.

Matrixport noted that the current leadership of the Commission consists of 5 people, and its chairman Gary Gensler does not support cryptocurrencies and it is unlikely that he will vote for approval. «Since traders started betting on ETFs in September 2023, at least $ 14 billion has been raised. This additional fiat money and leverage is being used in cryptocurrencies. Some of the flows may be related to the softening of macroeconomic conditions, as the Fed has begun to behave less harshly,» the experts write.

According to crypto industry analysts, if the Securities and Exchange Commission (SEC) does not approve spot bitcoin ETFs in early January, the market «will witness a cascading liquidation of a portion of the $ 5.1 billion in additional perpetual long futures.» As a result, the price of bitcoin will fall to $ 36,000, losing about 20%, and then return to $ 38,000.

At the same time, analysts said that even if the SEC refuses to approve the ETF, the price of bitcoin will still rise to $ 42,000, which should be facilitated by the US presidential election and halving.