How will the Bitcoin ETF affect the market?

Hopes for the approval of a Bitcoin ETF in the US rose recently, after Gary Gensler, president of the US Securities and Exchange Commission (SEC) suggested that it would be open to Bitcoin futures-based trading funds.

As the crypto community awaits the SEC's selection on crypto ETFs this month, launching such a product will no longer bode well for the cryptocurrency's rate in the quick term, says Dan Morehead, CEO of Pantera Capital.

The end of the bear market:

In a newsletter, Moorehead cited that we are now in a bull market after a brief period of chaos involving fears of China and its ban on cryptocurrency transactions and the mining industry.

Bitcoin has been booming considering that the beginning of this month.

Bitcoin is trading at $57,000 at the time of writing, which is a few thousand from the $65,000 historic high recorded in April 2021.

Some critics anticipate further beneficial properties for Bitcoin in the ultimate quarter of this year.

But Moorehead believes that the viable launch of a Bitcoin ETF could halt Bitcoin's bullish run.

A Bitcoin ETF will song the charge of Bitcoin, giving institutional traders publicity to Bitcoin without necessarily having to hold the cryptocurrency physically.

According to Dan Morehead, the Bitcoin ETF could damage the upward movement of Bitcoin.

For years, the crypto neighborhood anticipated SEC approval of a Bitcoin ETF due to the lack of regulated options for institutional investors.

But the regulator has rejected all bitcoin ETF proposals for that reason a ways on the grounds that there is inadequate safety for investors.

Most crypto investors consider that the launch of the Bitcoin ETF will push the fee of the cryptocurrency higher.

But Pantera's Moorehead sees it as a promoting moment based on buying the rumor and promoting the news.

Morehead cited two important cryptocurrency occasions in the past that resulted in a market pullback despite beginning with an confident outlook.

The first match was once after the Chicago Mercantile Exchange unveiled bitcoin futures in December 2017.

At the time, traders had been hoping that the checklist of bitcoin futures on the Chicago Mercantile Exchange would send the cryptocurrency to the moon.

However, the currency did no longer rise, on the contrary, it fell through 83%, in accordance to “Moorhead”.

This dismal trend used to be repeated once more this 12 months when the shares of the crypto business enterprise “Coinbase” have been listed on the Nasdaq exchange, as the currency soared and reached a file high of $ 64,000, after which it fell with the aid of 53%.

Morehead suggests that a similar state of affairs ought to be viewed if the SEC approves a Bitcoin ETF.

Morehead: Bitcoin will be nice in the long term
While Moorehead believes we will never once more revel in a a hundred percent rally this year, he helps the long-term bullish view of the large cryptocurrency, stating:

While we've had two 83% undergo markets already, I suppose they're section of our primitive past.

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