Final Frenzy Before SEC Decision on Bitcoin ETF?
Traders must remember that the rally from 25,000 to 38,000 is primarily built upon the assumption that the SEC will approve a Bitcoin Spot ETF. The SEC is still in an open lawsuit with Coinbase, which is expected to be the primary counterparty (prime broker and custodian) for various Bitcoin Spot ETF applicants, and the SEC sued Coinbase in June. Each of the four crypto bull markets (2011, 2013, 2017, and 2021) was associated with a novel way to acquire Bitcoins. With the approval of a Bitcoin Spot ETF, moving fiat from any bank into Bitcoin would then become possible.
What happens if nobody sells his Bitcoins to BlackRock?
During Bitcoin halving years, we have seen rallies of +186% (2012), +126% (2016) and +297% (2020). At a Bitcoin price of 40,000 per coin, twenty-five thousand coins equate to $1 billion – or 250,000 Bitcoins equate to $10 billion. Compare this to the approximately 328,125 Bitcoins that were (will be) mined in 2023. A BlackRock Bitcoin ETF could scoop up 76% of all the supply from the mining community – not even considering that rewards will be cut in half from April 2024 onwards. Only 5.8 million of the 19.4 million mined Bitcoins have been moved during the last year, signaling that 70% of coins are just held for longer. 2.4 million Bitcoins appear to have been moved during the last six months, and this short-term holder supply could indeed be seen as the true free-float of the Bitcoin market.
