We’ve talked about it already, but let’s lay out the possible scenarios for the Bitcoin ETF approval, and what the likely outcomes are.
I’m writing this on the 28th of December 2023. And these are just the possible scenarios I see playing out, and what I think may happen as a result.
NFA as always.
Plus, regardless of the outcome, I’m very bullish on Bitcoin and the industry long-term.
Let’s Begin
We’ve spoken about this before. Different ETF issuers have different approval dates.
The first round of deadlines start on January 10th. Others have later approval dates, but they’re all in January as well.
Scenario 1 – Instant Approval
If we see an ETF get approved at or before January 10th, which everyone is saying is the most likely scenario right now, I would expect….
- An immediate pop
- Followed by a large drop
The whole “buy the rumor, sell the news” mantra.
This happens all the time in crypto. Crypto YouTubers pump the shit out of the news like they always do, and the smart money dumps right in their viewers’ faces. And they never learn.
Scenario 2 – Other Issuers With Later Approval Dates Get Approved
The least likely scenario IMO.
So you’re telling me Blackrock gets denied and 21 Shares gets approved? Okay.
But if this happens, expect an early dump when the January 10th gang gets denied, followed by Scenario 1 once the approvals hit.
Scenario 3 – They All Get Approved
Another highly unlikely one, but if this happens, it’s Scenario 1 again probably.
Scenario 4 – None Get Approved
I can see a case for this, we’ve talked about it before.
The SEC makes up some goofy reason why they couldn’t approve any of them at this time and makes a really awkward speech about it.
They’ve probably already told the issuers this (especially Blackrock) behind closed doors.
The purpose would be to get price to drop, get the soft money out, and then approve them later this year at lower prices.
This is the “get your wallets out” scenario IMO.
Most people won’t know that the SEC can simply approve them at a later date and they’ll dump.
Good for people like us.
Scenario 5 – Up Only
In this scenario, no matter what happens, Bitcoin continues to go up, and other cryptos follow as they usually do.
Are your bags mostly packed?
This could be the start of the last real bananas bull market in crypto.
May want to hedge and make sure you’re at least somewhat satisfied with what you have currently.
For those of us with a longer term view, none of this even matters.
We load up early and simply wait for the madness to play out.
— VP