Tag: bitcoin
SEC rejects VanEck’s spot Bitcoin ETF as BTC price falls below $63K
The SEC claimed any rule change in favor of approving the ETF would not be “‘designed to prevent fraudulent and manipulative acts and practices” nor “protect investors and the public interest.”
The United States Securities and Exchange Commission, or SEC, has officially disapproved asset manager VanEck’s spot Bitcoin exchange-traded fund months after the firm submitted its application.
According to a Friday filing, the SEC rejected a proposed rule change from the Cboe BZX Exchange to list and trade shares of VanEck’s Bitcoin (BTC) Trust. Specifically, the SEC said any rule change in favor of approving the ETF would not be “‘designed to prevent fraudulent and manipulative acts and practices” nor “protect investors and the public interest.”
“The Commission concludes that BZX has not met its burden under the Exchange Act and the Commission’s Rules of Practice to demonstrate that its proposal is consistent with the requirements of Exchange Act Section,” said the SEC, adding:
“It is essential for an exchange listing a derivative securities product to enter into a surveillance-sharing agreement with markets trading the underlying assets for the listing exchange to have the ability to obtain information necessary to detect, investigate, and deter fraud and market manipulation, as well as violations of exchange rules and applicable federal securities laws and rules.”
The regulatory body had a maximum of 240 days to approve or deny the offering following its publication in the Federal Register on March 19, giving the SEC until Nov. 14 to make a decision after extensions on April 28 and Sept. 8. Industry expert Bloomberg senior ETF analyst Eric Balchunas said the SEC was highly unlikely to approve the VanEck fund given its track record of denying offerings from investment firms with exposure to crypto, a prediction which ultimately came to pass.
“[The SEC] address the inconsistency with not deeming CME a regulated mkt of sig size in spot denial but then approving futures ETFs,” said Balchunas. “It’s such a good point, but SEC doesn’t care. Not having it. Basically logic and reason are trumped by technical legality.”
Though the rejection may be a blow to many investors, the SEC has already approved ETFs linked to Bitcoin futures contracts. In October, shares of digital asset manager Valkyrie’s and ProShares’ BTC Strategy ETF launched on U.S. stock exchanges. ProShares’ ETF has since risen to the top 2% of all ETFs in terms of total trading volume — roughly $400 million worth of shares traded on Nov. 10.
The impact on the price of Bitcoin saw the crypto asset briefly dip to $62,300 before returning to more than $63,000. The price marks a 9.7% fall since Bitcoin reached a new all-time high of $69,000 on Nov. 10.
Report suggests BlackRock has ‘no current plans’ to launch crypto ETF as deadline for VanEck’s offering approaches
Senior ETF analyst at Bloomberg Eric Balchunas said he gave the odds of the SEC approving the VanEck fund at less than 1%.
BlackRock Financial Management’s global head of iShares and index investments said the financial firm will likely not be launching exchange-traded funds (ETFs) linked to crypto assets anytime soon.
According to a Friday report from Financial News, BlackRock executive Salim Ramji said the firm with $9.5 trillion in assets under management has “no current plans” to launch a cryptocurrency exchange-traded fund until there was additional regulatory clarity in the United States. He added that BlackRock would be unlikely to be among the first in this emerging market for investments with exposure to crypto, but the firm needed to practice due diligence.
“Before we wrap or put our brand on [crypto], we want to be certain that clients are going to be happy with us five years from now, 10 years from now,” said Ramji. “The regulatory arena for cryptocurrencies is still incredibly opaque and not clear at all.”
Bitcoin (BTC) Strategy ETFs from digital asset manager Valkyrie and ProShares launched on U.S. stock exchanges in October. Both funds allow U.S. investors direct exposure to cryptocurrency futures, with filings likely sparked from Securities and Exchange Commission (SEC) chair Gary Gensler hinting in August the agency could be open to approving exchange-traded products exposed to regulated BTC futures contracts.
ProShares’ fund reached more than $1 billion in assets under management in its first week of trading. In addition, the BTC Strategy ETF has since risen to the top 2% of all ETFs in terms of total trading volume — roughly $400 million worth of shares traded on Nov. 10.
Related: Why now? SEC took eight years to authorize a Bitcoin ETF in the US
While Valkyrie’s and ProShares’ BTC Strategy ETFs launched within a few days of each other, asset manager VanEck’s offering has yet to be approved for listing on any exchange despite conflicting media reports identifying a firm launch date. VanEck filed a prospectus for its Bitcoin Strategy ETF with the SEC on Aug. 9 but is also awaiting approval or denial for its spot Bitcoin ETF from the regulatory body, expected to reach a decision by Nov. 14.
Senior ETF analyst at Bloomberg Eric Balchunas said he gave the odds of the SEC approving the VanEck fund at less than 1% given its track record of denying offerings from investment firms with exposure to crypto.
“Eagles have better chance of winning SuperBowl,” said Balchunas.
Ethereum ‘has to bounce’ as ETH bulls pin $5K rally hopes on critical support channel
Many analysts agree that the “dynamic support” could boost accumulation sentiment in the ETH market.
Ethereum’s native token, Ether (ETH), could see yet another strong rebound in the sessions ahead as its price falls into a trading zone with a recent history of attracting buyers.
The rising trendline has been triggering ETH’s price rebounds since the beginning of October and comes as a part of a broader ascending channel range.
As a result, Ether’s path of least resistance has been to the upside despite pullbacks at the channel’s upper trendline, with its quarter-to-date returns currently sitting at over 38%.
Most recently, the rising trendline was instrumental in limiting sell-offs that followed Ether’s rally to a new record high above $4,870. That prompted analysts to expect another strong price rebound in the future, with a “swing long” setup posted by Forexn1 on TradingView calling for a bull run to $5,000.
MacroCRG, a Twitter-based independent market analyst, said Ether “has to bounce” as it manages to hold the rising trendline as support following the latest price pullback.
Meanwhile, another analyst, Pentoshi, also anticipated a rebound but discussed the prospects of corrections below the rising trendline. In a Nov. 12 tweet, he stated:
“I would love a 20-30% wipeout on alts. Usual bull run dip. Just bc I want it doesn’t mean it will happen. Greed to fear, please.”
Pentoshi’s downside target in the event of extended price correction was near $4,000, as shown in the chart below.
Macro fundamentals support ETH bulls
Ether’s ability to limit price corrections and — atop that — form new highs appears to have more than just technical factors behind it.
Chris Weston, head of research at Pepperstone Financial Pty, cited fears of high inflation as the common denominator that has boosted demand for potential hedging assets across the crypto market, leading to Ether’s 500-plus percent and Bitcoin’s 130-plus percent price rallies in 2021.
To investors, “Crypto is where the fast money is at,” Weston said in a note.
Additionally, Mike McGlone, senior commodity strategist at Bloomberg Index, last week said he expects a $5,000 price for Ether, saying that investment “portfolios of some combination of gold and bonds appear increasingly naked without some Bitcoin and Ethereum joining the mix.”
Three #Crypto Musketeers Driving $3 Trillion Market Cap – Representing a better way to transact, a strengthening ecosystem and here-to-stay asset class, #cryptodollars are the most significant advancing part of the digital-money revolution and the third leg of the crypto stool. pic.twitter.com/qhEOXttPW8
— Mike McGlone (@mikemcglone11) November 9, 2021
https://platform.twitter.com/widgets.js
The analyst cited declining supply as a major bullish backstop for Ether.
Namely, Ethereum’s software upgrade in August, dubbed the London hard fork, implemented a code-change that started burning a portion of gas fees paid to miners via ETH, effectively reducing the supply.
Related: Ascending channel pattern and Ethereum options data back traders’ $5K ETH target
The upgrade has resulted in the removal of over 860,500 ETH — now worth over $3.2 billion — since implementation, according to data provided by Ultrasound.money. At the current rate, the Ethereum network expects to burn 5.3 million ETH every year versus 5.4 million ETH issued.
McGlone noted that a declining supply rate would keep Ether on its bullish course against rising demand:
“Simply staying the course is the more likely outcome, as we see it. Ethereum has joined Bitcoin with a supply trajectory that is in decline by code. The first-born crypto is the store-of-value, and the No. 2 is the DeFi building block.”
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk, and you should conduct your own research when making a decision.
How traders can use Twitter to anticipate altcoin price moves
Data shows that a spike in Twitter mentions preceded massive price rallies in at least five altcoins.
When crypto traders win big, they often take to Twitter to share the joy. They tend to do the same for sharing painful stories of getting wrecked, discussing promising new assets, or sharing insight and predictions on which projects can become the next big thing. Sometimes these waves of social attention can even create positive feedback loops whereby the tokens that command the chatter see their prices soar precisely for that reason.
The volume of tweets referencing a particular asset can indicate a lot of different things. This month, the five tokens that saw the greatest month-to-month increases in daily tweet volume — Loopring’s LRC, NuCypher’s NU, Enjin Coin (ENJ), ANKR and The Sandbox’s (SAND) — also saw some of the heftiest monthly gains. This in itself is not at all shocking, as the assets that see huge rallies tend to attract the Twitter crowd’s attention.
What is remarkable, however, is that in all five cases, the record-breaking tweet volume peaks were actually registered not in response to monthly price highs but ahead of them. In other words, the sprawling Twitter conversations around these coins anticipated price action rather than followed it. How could traders catch the signs of this extraordinary social activity early?
Heads-up from the crowd
If you do not follow just about everyone on Crypto Twitter, there are few ways to reliably capture each surge in tweets around a particular asset. Subscribers of Markets Pro, Cointelegraph’s proprietary data intelligence platform, have it easy: A dedicated panel featuring five assets that are seeing an unusually high tweet volume is helpfully displayed in real time right on the dashboard.
Furthermore, tweet volume is one of several metrics used to calculate the VORTECS™ Score, an algorithmic indicator that compares patterns of past market and social activity around a digital asset with years’ worth of historical data performance to evaluate how bullish the coin’s outlook is.
In the case of the top Twitter darlings of the month, a look at raw Twitter data would be sufficient, as all of these coins appeared on the Unusual Twitter Volume panel as their tweet volume peaked.
LRC/USD: A 744.44% increase in tweet volume followed by a +350.79% monthly price change
One of the ingredients of the monstrous rally of LRC this month is the fact that the layer-two protocol continues to offer lower transaction fees compared with its counterparts, which comes in handy amid exorbitant gas fees on the Ethereum network.
Having surpassed 3,000, the volume of daily tweets mentioning the project exceeded the monthly average by more than 740% on Nov. 3 (the red circle in the chart) as the asset was nearing the local price peak at $1.54. After a brief correction, fueled by the influx of social attention, LRC continued to climb even higher, breaching $2 six days later.
NU/USD: A 598.87% increase in tweet volume triggered a +179.18% monthly price change
Nobody knows for sure where NU’s 10x-plus pump on Oct. 15 came from, but it saw the coin pop from around $0.30 to above $3 in just a few hours. Some Twitter users credited its listing on South Korean exchange Upbit for the uptick, yet chances are there could have been something else at play. Most likely, people were simply trying to figure out what was going on.
At any rate, the Unusual Twitter Volume indicator began to flash just two hours into the rally, with the highest rate showing up shortly before the price high of $3.17. Interestingly, social excitement around NU persisted for some time after the hard price correction, beginning to wane only a day after the price crumbled back to around $1.20.
ENJ/USD: A 354.32% surge in tweet volume accompanied a +90.35% monthly price change
Enjin Coin emerged as one of the beneficiaries of the metaverse tokens’ spree triggered by Facebook’s rebrand to Meta at the end of October.
The Twitter discussion around blockchain gaming platform Enjin reached its height on Oct. 31 against a price of $2.51 as ENJ was cooling off after a parabolic rally. The onslaught of Twitter mentions foreshadowed the next leg of the action, which took the coin to the next high at $3.45.
ANKR/USD: A 329.08% surge in tweet volume backed a +39.51% monthly price change
ANKR had a massive showing around the same time as metaverse assets skyrocketed, rising from $0.081 on Oct. 28 to $0.139 a week later.
As the token’s price briefly plateaued for a breather amid the hike, the Twitter numbers went into overdrive, hitting 2,400 daily mentions. After that, the token’s price made one more leap to the monthly high registered on Nov. 3.
SAND/USD: A 328.12% increase in tweet volume was followed by a +222.12% monthly price change
The Sandbox was yet another metaverse wonder whose token price skyrocketed following the Facebook/Meta news.
SAND’s healthy social outlook manifested when its daily tweet volume more than tripled compared with the month-to-month average, hitting a record high above 2,600 15 hours before a peak price of $3.38 was recorded.
Granted, the abnormal volume of tweets mentioning a certain asset is not in itself a recipe for an imminent price hike. Traders should delve into the actual context of what is going on around the token to render an informed decision. Yet, being alerted to massive spikes of attention to particular assets can be incredibly useful for focusing one’s analysis on the most likely candidates for a continued rally.
Cointelegraph is a publisher of financial information, not an investment adviser. We do not provide personalized or individualized investment advice. Cryptocurrencies are volatile investments and carry significant risk including the risk of permanent and total loss. Past performance is not indicative of future results. Figures and charts are correct at the time of writing or as otherwise specified. Live-tested strategies are not recommendations. Consult your financial advisor before making financial decisions.