Cryptocurrency investors are eagerly awaiting the U.S. Securities and Exchange Commission’s (SEC) decision on the approval of a spot Bitcoin Exchange-Traded Fund (ETF), with significant implications for Bitcoin’s price. Thirteen firms, including the world’s largest asset manager BlackRock, are hopeful for the green light on their ETF proposals.
Following a tumultuous 2022, Bitcoin’s price has seen a substantial increase throughout much of 2023, trading around $43,900, largely influenced by expectations surrounding the spot ETF approval. However, pessimistic reports of potential ETF rejections have historically led to price declines, exemplified by an 8% drop following rumors of a denial by Matrixport on January 3.
The crypto market remains optimistic while bracing for the SEC’s upcoming decision, though the possibility of an unfavorable outcome looms. Analyst Ali Martinez commented on the situation, suggesting that regardless of the ETF’s fate, another potential catalyst for Bitcoin’s price surge this year is the anticipated halving event.
Martinez highlighted the historical significance of halving events as major catalysts for price movements in Bitcoin’s history. He shared a graph displaying Bitcoin’s price performance 365 days after past halvings, noting over 6000% increase following the first halving and an average of over 400% increase in subsequent halvings.
While past halvings have been followed by significant price increases, it’s important to note that past performance does not necessarily predict future outcomes. The upcoming halving will reduce mining rewards from the current 6.25 Bitcoin per block to 3.125 Bitcoin, potentially impacting the supply and price dynamics.