Earlier this morning, during the BitMEX’s Bitcoin spike, the crypto markets looked like they were ready for a breakout as BTC almost got to levels above $7,000. BTC had increased by $400 dollars in a span of less than half an hour and was trading at $6,800. During this time period, the total crypto market capitalization had risen to $222.8 Billion from $210.6 Billion. The total market cap now seems to be going back to the levels before the BitMEX maintenance and currently at levels of $210 Billion.
The hope and euphoria that had enveloped the crypto-markets during this period of a brief resurgence of BTC seem to have been weighed down by a pending decision by the SEC on the ProShares ETFs.
The deadline to rule on the ProShares ETFs is tomorrow, the 23rd of August and many crypto traders and enthusiasts have not forgotten the market reactions during past SEC announcements. One trader in one of the busy Telegram chats reminded others of the popular phrase that goes as follows:
Everything that happens only once can never happen twice. But everything that happens twice will surely happen a third time.
Rejected Winklevoss ETF and the postponement of the CBOE ETF Decision
The above quoted phrase is a bit ominous given the fact that the market has over reacted on two occasions due to the SEC announcing news related to the Winklevoss and CBOE ETFs.
On the 26th of July, the SEC rejected the Winklevoss sponsored Bats ETF causing a knee jerk reaction in the market. This was due to the fact that many traders were convinced that the SEC had rejected the CBOE sponsored ETF. In simple words, there was total confusion and it resulted in panic selling in the markets.
A brief look at the value of Bitcoin yields that it was valued at around $8,200 before the rejection of the Bats ETF. After the announcement and panic selling, BTC would fall for over a week to a value of $7,000. Then the SEC dropped another announcement about postponing the CBOE ETF. This then resulted in BTC dropping from around $7,100 on August 7th, to $6,000 by the 14th.
On both occasions, BTC fell by an average of $1,000 in value, Does this mean that it will drop to around $5,600 if the SEC reject the ProShares ETFs?
Well Informed Crypto Community
Unlike the last two SEC announcement, the ProShares deadline comes at a time when crypto traders are more informed about which ETFs are pending at the SEC. Some have even already accepted that there is a possibility of a rejection and a possible market response of panic selling.
Most have a well laid out game plan on either outcome of a rejection or an acceptance of changing the rules as proposed by the ProShares ETFs.