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Bitcoin ETF: SEC Could Make the "Rug Pull of the Decade" Warns Bloomberg Analyst

Bloomberg analyst says there's a slim chance of spot Bitcoin ETF rejection

Amidst intense anticipation, the crypto world holds its breath as the Securities and Exchange Commission (SEC) deliberates on the fate of Bitcoin exchange-traded funds (ETFs). Bloomberg ETF analyst Eric Balchunas, alongside colleague James Seyffart, places a 90% approval likelihood by January 10. However, the lingering 10% uncertainty embodies the SEC's possible desire for extended evaluation time, rather than outright rejection.

 

James Seyffart(@JSeyff):

“New Research note from me today. We still believe 90% chance by Jan 10 for spot #Bitcoin ETF approvals. But if it comes earlier we are entering a window where a wave of approval orders for all the current applicants *COULD* occur”  

 

This pivotal moment, teetering on the edge of hope and hesitation, highlights the intricate dance between innovation and regulation. Eric Balchunas, a seasoned voice in ETF analysis, emphasizes the immense efforts invested by the SEC and Bitcoin ETF proponents, suggesting that an outright denial at this juncture would be unprecedented. 

 

“This would be the rug pull of the decade."

“Everybody put in a lot of work in this, especially over the holidays. Sadistic might not even be strong enough a word for it.”

 

The tone of cautious optimism is echoed by Vetle Lunde of K33 Research, who assigns a mere 5% risk to the rejection scenario. However, Balchunas warns that a negative verdict could ignite a fierce legal backlash, akin to the path taken by crypto asset manager Grayscale. 

 

Eric Balchunas added:

“People have spent too much money and tried too hard to give up now. So yeah, it would not be over. I don’t even think there’d be a cooling-off period this time. I think there'd be hell.” 

 

This looming possibility paints a complex picture of resilience and determination in the face of regulatory hurdles, reflecting the high stakes and deep commitments of the parties involved.

Public sentiment around the pivotal decision 

The public's engagement in this matter is palpable, with recent comments submitted to the SEC vividly expressing diverse viewpoints. A notable concern highlighted in these submissions is Bitcoin's decentralized nature, raising questions about its potential use by authoritarian regimes to bypass sanctions and exert control. 

This aspect underscores the global ramifications of the SEC's decision, transcending mere investment considerations. The outcome, therefore, is not just a verdict on a financial product but a statement on the role of cryptocurrencies in the international financial system and their interaction with geopolitics.