Bitcoin ETF Approval Fails to Spark Anticipated Market Rally

• The SEC has finally approved spot Bitcoin ETFs following a decade-long wait.
• Despite the development, Bitcoin’s price remained largely muted. 
• Ethereum managed to hold on to earlier gains while others experienced modest spikes.

Crypto asset prices have shown increased signs of strength in the past year on the back of hope that the SEC was set to finally approve a spot Bitcoin ETF product that could usher in trillions of dollars into the crypto market from traditional and institutional investors. However, these crypto asset prices remained largely muted after the SEC’s historic decision on Wednesday, January 10. 

Spot Bitcoin ETFs Priced In?

As has been anticipated by most issuers and experts in recent weeks, on Wednesday, January 10, the SEC greenlit a wave of spot Bitcoin ETFs , including applications from Ark 21Shares, BlackRock, Fidelity, Grayscale, and more. 

The announcement, however, failed to spark a massive crypto asset price rally as many had anticipated, seemingly giving credence to arguments that the development had been priced in. Bitcoin’s price, for one, saw a slight decline. As the news broke, the asset’s price ranged between $46,000 and $45,500. At the time of writing, however, the asset’s price has shown some modest gains, trading around $46,500. Analysts expect Bitcoin’s price to be strong should approved ETFs see significant interest on trading day.

Moving in lockstep with the crypto market leader, Ethereum also barely moved, hovering above the $2,500 price level, holding on to gains it had recorded earlier in the day, attributed to speculators hedging their bets ahead of the SEC’s decision. At the time of writing, the asset continues to hover around the $2,500 level, trading at $2,543.

Despite Bitcoin and Ethereum’s lackluster price movements, some major altcoins did show some volatility following the news release.

XRP, Cardano (ADA), and DOGE Experience Modest Spikes

Following the news, XRP experienced a 4% rally, with the price jumping from $0.5728 to $0.5969. At the time of writing, the asset is trading at $0.6068, continuing its rally.

Like XRP, Cardano (ADA) also experienced a modest price increase, jumping from $0.512 to $0.551. The asset is now trading at $0.5708, also seemingly continuing its upward momentum.

Memecoins were not left out as DOGE rallied nearly 5%, with the asset’s price surging from $0.0780 to $0.0818. At the time of writing, the popular doggy-themed memecoin’s rally continues, with the asset trading at $0.8324.

On the Flipside

• Crypto asset prices could increase if approved ETFs see significant interest on trading day.
• Following the approval of spot Bitcoin ETFs, attention is likely to shift to pending applications for a similar product for Ethereum.
• Crypto asset prices had temporarily surged following a fake approval report on Tuesday, January 9.

Why This Matters

Crypto industry participants have been fighting for the approval of a spot Bitcoin ETF in the U.S. for over a decade. The crypto market reaction to the SEC’s decision fails to highlight the excitement surrounding the historic move.

Read this for more on the SEC’s historic decision:
Breaking: SEC Finally Approves All Spot Bitcoin ETFs

Learn about Polygon’s latest institutional move:
Polygon to Power the First TradFi-Focused Ethereum Layer 2