A wide range of institutional investors has recently shown interest in the rapidly developing blockchain area. However, the fintech has suffered a great variety of blows in the form of Bitcoin ETF application rejections from the U.S. SEC.
There have been many attempts to apply for the permission to list and trade Bitcoin ETFs (Exchange-Traded Funds), including that of Tyler and Cameron Winklevoss, founders of Gemini. In the weeks of anticipation before the decision, the Bitcoin price jumped from around $6,000 to $8,300, while the rejection made the price to go back down.
The previous example was not unique in its nature, as eight other Bitcoin ETF applications received rejections from the SEC. The Commision is currently reviewing three more applications and the public is anxiously waiting for its decisions. Moreover, it’s interesting to notice, that Coinbase is also working on an application for cryptocurrency and Bitcoin ETFs.
For obvious reasons, the price fluctuations of Bitcoin has been directly correlated with the changes in the matter of Bitcoin ETF applications. Every time there exists anticipation of Bitcoin ETFs to be approved, simultaneously the Bitcoin value increases. Subsequently, if the SEC denies applications, the price immediately falls.
The reasons for such rapid price shifts on the market are highly important for the future of the Bitcoin network. The Bitcoin price increases due to a common belief of hodlers in the fact that a decision will happen soon. They hope the result will be positive and the institutional investors will enter the digital currency market.