Key Insights:
- Bitcoin declined by 1.08% on Friday, ending the session at $42,200.
- SEC v Terraform Labs/Do Kwon ruling impacts buyer demand for cryptos.
- Progress toward a BTC-spot ETF market remains a focal point.
Bitcoin Sees Red Despite a Flurry of BTC-Spot ETF-Related Activity
Bitcoin (BTC) declined by 1.08% on Friday. Following a 1.88% slide on Thursday, BTC ended the Friday session at $42,200. Significantly, BTC dropped below the $42,000 handle for the second time since December 19.
The SEC v Terraform Labs/Do Kwon ruling impacted buyer demand for cryptos. Significantly, the ruling that Luna and TerraUSD were securities delivered more regulatory uncertainty.
However, progress toward a BTC-spot ETF market limited the losses on the day. Bloomberg Intelligence ETF Analyst Eric Balchunas shared updates on S-1 amendments. Issuers filed the S-1s in time for the SEC-imposed December 29 deadline. Notable filings included,
- Fidelity: The filing included its fee of 0.39%, reportedly the lowest so far.
- Bitwise Invest: Filed their third S-1 but did not disclose a fee.
- Invesco/Galaxy: The S-1 filing named Virtu and JPMorgan (JPM) as Authorized Participants (APs), waiving fees for the first six months.
- Franklin Templeton: Filed an amended S-1 in time for the Friday deadline.
- WisdomTree: Amened S-1 filing named Jane Street as its AP.
- Valkyrie Funds: S-1 filing named Jane Street and Cantor Fitzgerald as their APs and stated an 80-bps annual fee.
- BlackRock: Named Jane Street and JPMorgan as its APs.
- VanEck: Submitted an amended S-1. Significantly, VanEck included a risk disclosure clause about the SEC not allowing In-kind creations.
Some issuers named JPMorgan as an authorized participant despite the JPMorgan Chase CEO’s stance on BTC. In December 2023, JPMorgan Chase CEO Jamie Dimon delivered an anti-crypto tirade at a Banking Committee hearing on Capitol Hill. The JPM CEO famously said,
“If I was government, I would close it down.”
Market reaction to the Terraform Labs/Do Kwon ruling overshadowed the flurry of BTC-spot ETF-related activity.
SEC v Terraform Labs/Do Kwon: TerraUSD and Luna Are Securities
On Thursday, Judge Rakoff ruled that TerraUSD and Luna are securities. The ruling impacted the crypto market. Significantly, the ruling places greater importance on the SEC v Coinbase case. The SEC v Terraform Labs/Do Kown trial begins on January 29, 2024.
On January 17, 2024, Judge Failla will hear oral arguments on the Coinbase (COIN) motion to dismiss (MTD). Coinbase filed an MTD in August, arguing the SEC lacks the statutory authority to regulate crypto exchanges.
Bitcoin Price Forecast
Every new Bitcoin analysis as it publishes, today's technical signal and key levels, live price — on one page.
See all Bitcoin forecastsOn Saturday, updates related to BTC-spot ETFs remain the focal points.
However, a fall below the $41,500 handle would bring the 50-day EMA and $39,861 support level into play.
The 14-Daily RSI reading, 49.97, suggests a BTC fall to the 50-day EMA before entering oversold territory.
Ethereum Analysis
ETH remained above the 50-day and 200-day EMAs, reaffirming bullish price signals.
An ETH breakout from the $2,300 resistance level would support a move toward the $2,457 resistance level.
However, a drop below the $2,250 handle would bring the 50-day EMA and $2,143 support level into play.
The 14-period Daily RSI at 54.59 indicates an ETH return to the $2,400 handle before entering overbought territory.
