On Monday, Bitcoin briefly rose above $30,000 following rumors on Cointelegraph’s X social network about the U.S. Securities and Exchange Commission (SEC) approving iShares’ Bitcoin ETF application. The excitement was short-lived, as Bloomberg refuted the news, causing Bitcoin to plummet back to $28,000. In reality, iShares’ ETF application is still pending.
Impact on Other Cryptos
Bitcoin’s price fluctuations had a ripple effect on other cryptocurrencies. Ripple’s XRP and Binance Coin, the leading coins after Bitcoin and Ethereum by market capitalization, rose by over 1%. Solana’s Sol token saw a 6% increase, while Cardano’s Ada token rose by 2%.
Cryptocurrency Stocks Follow Suit
Cryptocurrency-related stocks mirrored the market’s volatility. Shares of Coinbase rose over 2% in early trading on Monday, while mining companies like Riot Platforms and Marathon Digital saw gains of approximately 5%.
Margin Position Liquidation
In the wake of the Bitcoin price rumors, a wave of margin position liquidations occurred. Within an hour, traders on crypto exchanges lost a total of $103 million, with $64 million in BTC and $17.9 million in Ethereum.
SEC’s Grayscale Lawsuit
Last week, Bitcoin surged after the SEC announced it wouldn’t appeal the decision in Grayscale’s lawsuit. In June 2022, Grayscale sued the SEC for rejecting their application to convert the Grayscale Bitcoin Trust (GBTC) into an ETF. Though the SEC could still reject Grayscale’s request, it seems that they might be more favorable this time, given the D.C. Court of Appeals’ criticism of their previous denial.
Bitcoin’s Recent Performance
Bitcoin had a tough week, losing 4.35% and closing at $26,755.66. Ethereum also struggled, ending the week at $1,544.24 with a 6.36% loss. Regulatory uncertainty in the US crypto industry has placed continuous pressure on Bitcoin’s price, resulting in low volume and liquidity, notes NIX Solutions.
Bitcoin as a Safe Haven
Intriguingly, despite the challenges, some believe that Bitcoin and other cryptocurrencies could become safe havens amid recession fears. Recently, Paul Tudor Jones and JPMorgan touted Bitcoin as a hedge for uncertain economic conditions.