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Fidelity Exec Predicts Bitcoin (BTC) Price Churn After ETF Approval

Wed, 17/01/2024 - 16:24
 Fidelity Exec Predicts Bitcoin (BTC) Price Churn After ETF Approval
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Jurrien Timmer, a high-ranking executive at Fidelity Investments, has provided an insightful analysis on the potential impact of the U.S. Securities and Exchange Commission’s (SEC) recent approval of spot Bitcoin ETFs. 

Timmer stressed that this approval marks a significant milestone in Bitcoin's journey to becoming a mainstream financial asset.

However, it could also lead to short-term price volatility. He emphasized the importance of focusing on Bitcoin's adoption curve and the influence of monetary policy on its value.

The Bitcoin (BTC) price experienced a massive drop from the peak of $49,000 which was reached shortly after the ETF approval. The leading cryptocurrency is currently trading at $42,408, according to CoinGecko data.   

Short-term bearishness 

A key concern raised by Timmer is the possibility of a "sell-the-news" reaction in the Bitcoin market. He predicts that the market might need time to consolidate recent gains following the significant development of the ETF approval. 


Supporting his view, Timmer pointed to recent trends in open interest (OI) and movements in the Goldman Sachs Bitcoin-sensitive equities index. 

He anticipates a decrease in OI as asset managers shift from futures to spot positions, a transition that could introduce volatility in Bitcoin prices in the short term.

Adoption takes time 

Timmer expressed excitement over the SEC’s decision, seeing it as a potential catalyst for Bitcoin's broader acceptance as a commodity-currency. 

However, he cautioned that achieving widespread adoption might take time. 

According to Timmer, Bitcoin currently sits in the middle of what he calls its "fair value band," which is influenced by the network's growth rate and real interest rates. 


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