Bitcoin (BTC) and the broader crypto market are showing signs of weakness in early trading on Friday as the months of hype surrounding the potential approval of the first spot BTC ETF has exhausted bullish traders despite rumors that the first approval could happen today.
The latest news circulating in the cryptosphere is that BlackRock plans to make a $10 million Bitcoin purchase on Friday to start seeding their Bitcoin ETF, despite a lack of approval from the Securities and Exchange Commission (SEC).
The firm originally teased that it would make the purchase on Wednesday, which also happened to be the 15th anniversary of the Bitcoin genesis block, but those plans were delayed.
Rumors circulating on Thursday suggested that the approval could come as soon as Friday, which helped boost BTC back above $44,000 in the afternoon, but multiple analysts pushed back against that possibility as some of the applications still require changes that the SEC requested before approval.
According to Bloomberg ETF analyst James Seyffart, “Today we're looking for 19b-4 amendment filings that'll include changes that SEC and issuers have been discussing for weeks. Namely, cash create/redeem.”
Seyffart added that he is “Still expecting potential approval orders next week.”
Fox Business producer Eleanor Terrett corroborated this outlook.
“Expecting some amended 19b-4 filings today as well as some eleventh-hour phone calls concerning comments on S-1s and possible launch dates,” she wrote on X. “The timeline for approvals still looking like next week but will all depend on how fast the @SECGov can read through comments and amendments made today. It really is just a ‘dotting the i’s and crossing the t’s’ situation now.”
Despite these insights from people with inside sources on the matter, the speculation about when the ETF will be approved is not likely to die down until after January 10, as the window for the SEC to make a decision on the applications is now open.
"The approval/rejection period for the Spot ETFs BTC filings commences today, with the SEC expected to provide a response by the 10th of January,” said Matteo Greco, research analyst at Fineqia International, in a note shared with Kitco Crypto. “Market participants maintain expectations for the approval of the 21Shares filing, potentially triggering a cascade approval for all issuers. Numerous meetings between the SEC, issuers, and exchanges have fuelled the narrative of an imminent approval.”
“The introduction of ETFs could usher in new investor cohorts from traditional finance, significantly improving market transparency and liquidity and bringing long term capital inflow in the digital assets market,” Greco said.
While crypto proponents are excited about the influx of capital, new users, and institutional involvement that an ETF will bring, James Gorman, chair and former CEO of Morgan Stanley, warned big-money investors that BTC should not comprise a substantial part of their portfolios.
“I've never really understood the value of Bitcoin as a form of stored value,” Gorman said during an interview with Bloomberg. "I joked once, I wish I bought it at $60 and I'm glad I didn't buy it at $60,000. It should play, for wealthy people, a very small role in their financial fabric because it's so speculative, it's so volatile, and again, it's going through enormous regulatory change and industry disruption – we've seen some classic failures of late."
That said, Gorman also thinks that the repeated declarations that “Bitcoin is dead” are overblown, and sees the asset class surviving into the future.
“Listen, Bitcoin's not going away, it's not a fad," he said. "I just don't think it's a core investment. I think it's a speculative asset of which there are plenty of choices."
At the time of writing, Bitcoin is trading at $43,430, a decline of 1% on the 24-hour chart.
BTC/USD Chart by TradingView
