In a remarkable turn of events, bears traders have reportedly liquidated short positions worth nearly $150 million. This massive liquidation comes in anticipation of the approval of a Bitcoin Exchange-Traded Fund (ETF) by the U.S. Securities and Exchange Commission (SEC). The crypto market has been buzzing with anticipation as the SEC nears its decision to approve spot Bitcoin ETFs.
The odds stand at a 95% probability of approval by January 10, 2024. This optimism is reflected in Bitcoin’s price surge past $47,000, a first since March 2022. The latest market movements have triggered significant liquidations of short positions, which totaled more than $147 million. Crypto exchanges Binance and OKX saw massive liquidations, $72 million and $81 million respectively. At the same time, Huobi and Bybit lost approximately $20 Million each.
Short sellers were primarily impacted by the liquidations, incurring losses exceeding $147 million within 24 hours. This marked the second-highest volume of short liquidations in a single day since mid-November. Bitcoin traders experienced substantial liquidations amounting to $36 million, predominantly impacting those who had established short positions.
Monday’s Development Has Set the Market’s Mood for Bears
On Monday, a significant development occurred in the cryptocurrency market. A variety of potential issuers, including BlackRock (BLK) and Grayscale, submitted their offering fees to the U.S. Securities and Exchange Commission (SEC). This marks a crucial step towards the launch of the first-ever Bitcoin ETF in the United States.
Thirteen proposed ETFs are pending approval from the SEC, and competition for clients appears to be intensifying with some issuers offering a fee-free period for the initial six months or until they reach $5 billion in assets under management.
The SEC is anticipated to make a final verdict on the approvals or rejections by Wednesday. In the meantime, it’s reported that SEC representatives have provided feedback to a group of potential issuers regarding minor aspects in the revised S-1 forms, which are expected to be filed on Tuesday.
In conclusion, anticipating the Bitcoin ETF approval has led to a significant shift in the crypto market dynamics. As bearish traders liquidate their short positions, the market is poised for potentially greater liquidity and exposure. However, the outcome hinges on the SEC’s impending decision.