On March 10 after the closing of the New York Stock Exchange, the Securities and Exchange Commission (SEC) rejected the rule change for the Bitcoin ETF due to regulatory concerns. Following the announcement, the price per bitcoin dropped to a low of US$1,020. The price has since rebounded to $1,180 mark at the time of writing.
Also read: SEC Rejects Rule Change for Bitcoin ETF
Bitcoin Price Dives Minutes After ETF Ruling
Bitcoin markets took a sharp dive after the SEC announcement, losing 15 percent of its price value in a matter of minutes. During the day the price had climbed to a new all-time high for a short period as people waited for the decision from the U.S. regulatory agency. However, as soon as the decision was made the decline started creating significant volatility and slow exchanges. The bitcoin exchange Coinbase suffered from an outage during the event but camed back online shortly after the initial price drop.
Most of the bitcoin community across forums and social media seemed to brush the news off quickly. Some even welcomed the rejection with open arms saying they didn’t want the ETF approved.
Some Expect ‘Continued Volatility and High Volume’
Many bitcoin proponents said the price was expected to be volatile following the announcement either way. “The markets are digesting the information at the moment – we expect continued volatility and high volume,” explains the cryptocurrency data website Crypto Compare founder Charles Hayter, detailing his opinion of the situation;
“The SEC does not like Bitcoin being unchained from all regulation, and this move is, in essence, a form of consumer protection,” Hayter explained.
‘Large Players Sitting on the Sidelines’
Petar Zivkovski, Chief operating officer of the bitcoin trading platform Whaleclub spoke with Bitcoin.com and gave us Whaleclub’s opinion of bitcoin markets going forward.
“We expect a substantial decrease in volatility going forward, both in selling and buying BTC. Most of the run upwards from the $750 level was powered by rumors and speculation surrounding the Coin ETF,” Zivkovski told Bitcoin.com.
That event is now resolved and there is hence less uncertainty in the market, which translates to less volatility. Large players have exited bitcoin for now and are sitting on the sidelines waiting for another bullish or bearish catalyst. Many fear bitcoin’s scalability issues will take center stage again, which could put negative pressure on price. — We can expect a relatively flat or slightly declining market until then.
The price seems to have consolidated from the initial shock as markets have tamed and bitcoin’s price rejuvenates. The SEC staff can still approve a bitcoin ETF after more regulation and oversight is considered. Bitcoin proponents who supported the ETF still seem optimistic that a digital currency fund could come to fruition in the future, and some could care less.
What do you think about the market reaction to the ETF decision? Let us know in the comments below.
Images courtesy of Shutterstock, Pixabay, Bitcoin Wisdom, and Bitcoin.com.
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