ETF anticipation crescendos

This could be the week that the U.S. Securities and Exchange Commission permits the launch of ETFs mirroring the spot price of Bitcoin.

Quickening pulses of crypto industry watchers everywhere, Valkyrie, an ETF manager, stepped forth to file one last amendment to its proposal ahead of a hotly anticipated deadline this coming Wednesday, January 10. Other asset managers, including WisdomTree, BlackRock and Van Eck, followed suit. These seemingly minor formalities were interpreted by analysts as bright green tea leaves.

Bloomberg Intelligence’s Eric Balchunas now estimates that there's only roughly a 5% chance of spot BTC ETFs not winning approval this month. He’s basically sure of it but leaving wiggle room for the possibility of a doom scenario, one in which SEC Chairman Gary Gensler, perhaps nudged by the Biden Administration, goes nuclear and rejects the proposals, inviting a fresh round of court battles. Otherwise, the window for the SEC's decision looms this week (or really the next 48 hours).

Polymarket participants peg the ETF approval odds at 82%.

However, a recent Bitwise poll of financial advisors showed that only about one-third of them are confident the SEC will green light spot BTC ETFs at some point this year.

As of 8 a.m. (EST), BTC was $44,870, up 1.8% in 24 hours.

Talking to Decrypt about the looming ease of crypto access via new ETFs, WisdomTree's Benjamin Dean likened them to "iTunes for Bitcoin."

Several big altcoins are sore today. Although, among Big Ten digital assets, the 24-hour rash cases aren't too acute, with Solana and Cardano each declining 1%-2%.

Celestia's TIA, 44th-largest token, and three days removed from an ATH, has declined 9% since this time yesterday. TIA is down 19% since hitting $17.13 on Friday.

Filecoin is the 34th-largest crypto with a market capitalization of $2.77 billion. That figure is 23% lower than it was last Monday.

Helium, meanwhile, has deflated by nearly 30% in the past week. HNT, 89th-largest coin, lost 7% overnight.

Did we mention memecoins are getting crushed? Solana-run dog-themed asset BONK is down 70% from its December peak, following a weeks-long streak of appreciating by 1,000%. Some lesser-known Solana-spawned cat coins are down huge from their preposterous highs as well, per CoinDesk.

SOL sprang from $30 to $120 during the final sixty days of 2023, partly on an outbreak of memecoin fever within the Solana community. But in the past two weeks, SOL has shed 16%.

Spot crypto ETFs are coming. It's a near certainty. A baker's dozen of money managers await approval for products that they've cooked up.

"The general consensus is that the SEC will approve multiple spot Bitcoin ETF applications at once to level the playing field," CoinTurk said.

As mentioned above, this could all go down in the next couple of days. BlackRock, Invesco, Fidelity, Grayscale, Ark, Bitwise and VanEck tweaked their applications in response to painstaking guidance from regulatory taskmasters.

The 13 spot BTC ETF applicants were instructed to file one last form (“S-1”) by 8 a.m. (EST) today, teeing up a decision by Wednesday.

So now traders might well brace for sell the news conditions and perhaps lean into a new parlor game connected with speculation about Ethereum ETFs.

Cointelegraph, citing Bloomberg’s James Seyffart, said the SEC has "implicitly" accepted ETH as a commodity by virtue of having approved Ethereum futures ETFs. Thus, if the SEC were to deem ETH a security, it could face legal challenges and would have to de-list ETFs tied to ETH futures, Seyffart explained. The industry can potentially expect to see Ethereum ETFs "approved this year," the widely followed analyst has said publicly. The SEC’s deadline for deciding on spot ETH ETFs is set for this coming May.