Bitcoin stalls near $29K as markets await spot ETF outcome

As excitement continues to fade from a definitive ruling on a spot bitcoin ETF, long positions are becoming increasingly expensive

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Bitcoin remains stagnant, moving a mere $100 from last week, as investors hold their breath in anticipation of the US Security and Exchange Commission’s decisions surrounding exchange-traded funds (ETFs).

Despite early optimism that drove prices from $25,000 to $29,000 earlier this summer, the market has been trapped in a state of uncertainty, with participants seemingly indifferent to minor volatility. Bitcoin is currently trading near $29,150 and remains little changed on the day.

In the past 24 hours, the bitcoin derivatives market has displayed a near-balanced distribution between long and short positions across major exchanges, including Binance, OKX, and Deribit, Coinglass data shows. The equilibrium may be reflecting a state of uncertainty or mixed sentiment among traders, without a clear consensus leaning either bullish or bearish.

The market had anticipated increased action earlier this month, with potential dates for SEC feedback on spot bitcoin filings. No decision forthcoming leaves the crypto community in continued suspense.

The delay concerning ARK’s 21Shares BTC ETF, bolstered by applications from financial giants like Fidelity and Blackrock, has contributed to the market’s wait-and-see stance. 

While not an outright rejection, the deferment has tempered some of the previous optimism surrounding a seemingly certain bitcoin ETF, according to digital asset firm BitOoda.

New dissenting opinions such as those expressed in a detailed letter from Better Markets, outlining reasons a bitcoin ETF should be rejected, compound the uncertainty. If similar concerns influence the SEC’s ultimate decision, it could prolong the current market stagnation, the firm added.

Nevertheless, clarity may be on the horizon, with many anticipating an update or ruling from the ongoing Grayscale vs SEC dispute about the asset manager converting its flagship Trust to a spot ETF.

This could paint the picture for all spot ETFs, including those for ether (ETH), adding yet another layer of complexity to muted price action.

“The conditions of the bitcoin market continue to resemble the bear market hangover seen in prior cycles, with an outsized wealth held by long-term high conviction holders,” Glassnode wrote in a recent note.

Still, with low volatility comes “apathy and exhaustion” which may signal a relatively weak inflow of demand, the on-chain intelligence platform said.

While major blue-chip digital assets remained flat, the majority of cryptos within the top 50 by market capitalization fell roughly between 3% and 10% late Tuesday.


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