[TL; DR]
Since the overall surge in the crypto market in the first quarter of this year and gaining market attention, it has been at a freezing point of continuous fluctuations and adjustments since the second quarter;
Bitcoin has been in a downward trend for the past two months, causing a large number of Altcoins to decline by more than 10%;
The exchange rate of Ethereum, which has always been strong, has also hit new lows one after another compared to Bitcoin. Gate.io Bitcoin daily trend chart-source: Gate.io
From All Season in Q1 to Bitcoin Season in Q2, there is an increasing shortage of funds on the market, and the sustainability of market hotspots is weak. The dull and boring market often requires significant events to break through. Currently, the important catalysts that the market is generally looking forward to are:
When Will the Federal Reserve Cut Interest Rates
Although there are still some disagreements on whether the Federal Reserve will continue to raise interest rates in September, the common view is that the Federal Reserve will start cutting interest rates as soon as Q2 next year, which will be combined with Bitcoin halving during the same period, making it a clear sign of both internal and external factors being bullish. In the short term, you can pay attention to the Federal Reserve's monetary minutes at 2 am on August 17. Still, based on the past reactions of currency prices to Federal Reserve policies, this marginal impact is weakening.
When Will the Bitcoin Ecosystem Prosper?
Much of the prosperity of the crypto market occurred during Summer, and BRC20 Summer brought new concepts of Ordinals and In_script_ions to the market. Active on chain activities increased miners' income, but the increase in transaction costs also reduced the accessibility of Bitcoin, sparking intense discussions in the community. Unfortunately, we did not see a positive response from the popularity of BRC20 Summer to the price of Bitcoin on that day, and the prosperity of the Bitcoin ecosystem also requires further infrastructure improvement.
When Will the Spot Bitcoin ETF Be Approved
Bitcoin spot ETFs will attract a large group of over-the-counter institutional investors who have yet to enter the previous bull market, and may become the biggest trigger for this bull market. Presently, the crypto market is experiencing a new regulatory situation where the West is not bright and the East is bright. "Becoming mainstream" means that cryptocurrencies must be able to pass regulatory experiments.
Canada, Brazil, and the United Kingdom have all launched spot Bitcoin ETFs. However, based on the greater impact of the US dollar (stablecoin) on the Bitcoin market, the approval attitude of US regulators, who currently have a large amount of US dollar hot money, towards spot Bitcoin ETFs has become the most concerning point.
The US SEC has conducted a lengthy review of spot Bitcoin ETFs, and despite multiple delays and rejections, a steady stream of institutions have submitted applications for the product. Currently, investment companies awaiting official decisions include ARK Invest and 21Shares, Bitwise, BlackRock, VanEck, WisdomTree, Invesco and Galaxy Digital, Fidelity, and Valkyrie. These companies collectively manage over $15 trillion in global assets.
Although it has been pulled several times, the SEC has finally taken a substantial step forward. The SEC opened a 21-day review period for the ARK 21Shares Bitcoin ETF on August 11, and also raised concerns about Coinbase's monitoring sharing protocol, requiring commentators to check whether Coinbase's participation in ETF monitoring actually helps detect, investigate, and prevent fraud and manipulation of Bitcoin prices.
From a timeline perspective, the SEC needs to respond to the Bitwise Bitcoin ETP Trust by September 1, while the application decisions for BlackRock, VanEck, WisdomTree, and Invesco will be made one day later, with other applications following closely.
But the SEC may continue to delay, which may be related to concerns about market fraud and manipulation that the product may be involved in, as well as Grayscale's lawsuit against the SEC for refusing to convert GBTC into a spot Bitcoin ETF. The decision on this case will be made before the end of this year.
In fact, looking back at history, whether it's the launch of benchmark gold ETFs or the launch of Bitcoin Trust (GBTC), these ETF products have greatly brought in the intervention of massive funds and become important boosters of market prosperity. Timeline of gold ETF release and gold price trend-Source: crypto platform
The 2020 Bitcoin Bull Market Accompanied by the Growth of Grayscale Bitcoin Trust Positions-Source: Coinglass
Conclusion
Ten years after the approval of the first Bitcoin Trust (GBTC) and the submission of the registration statement for spot Bitcoin ETFs, the approval of spot Bitcoin ETFs has finally reached a critical moment. Investors are still enthusiastic, and regulatory authorities are cautiously finding compliance measures.
The questioning will eventually end, and we have reason to expect that the funding channel between cryptocurrencies and the real world will soon open. Due to its low investment threshold, low trading costs, good liquidity, and simple trading process, the approval of spot Bitcoin ETFs may end the current market's idle weakness, and further promote the recovery and prosperity of the crypto market.
When Will the Federal Reserve Cut Interest Rates
When Will the Bitcoin Eco_ Prosper?
When Will the Spot Bitcoin ETF Be Approved
Conclusion
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