Cryptocurrency analyst Nate Geraci has revealed that a rejection of a Bitcoin Spot Exchange-Traded Fund (ETF) by the SEC could lead to a significantly negative effect on the entire cryptocurrency market.
Bitcoin Spot ETF Denial To Impact The Crypto Space
Nate Geraci took to his official X (formerly Twitter) handle to share his optimism on the impact of a Bitcoin Spot ETF if rejected. The analyst’s recent prediction came amidst the recent bearish sentiment encompassing the crypto asset and market.
According to him, if the United States Securities and Exchange Commission (SEC) denies a Bitcoin Spot ETF, it could lead to a major rug pull in cryptocurrency. He asserted that if an ETF is not approved in January, the rug pull will be one of the “bigger rug pulls” in crypto history.
This is due to the significant impact that the anticipation of an ETF approval has had on the entire crypto market lately. The impending decision, which is anticipated to take place next month, may also mark a turning point in the acceptance of cryptocurrencies in traditional finance.
Nate also highlighted on his X post a 100% possibility of a Bitcoin ETF approval by the SEC. “Not my base case, but can’t entirely rule out given history here, which is why I said close to 100%,” he noted.
The crypto analyst’s projections towards the approval of an ETF have not changed over time. In August, Geraci also predicted the same percentage possibility of a Spot Bitcoin ETF approval by the SEC.
He pointed out several court victories by Grayscale over the regulatory watchdog and a COIN SSA. This is ultimately why he believes the odds of the product being approved are 100%.
If the SEC approves an ETF, the cryptocurrency market, which is still recovering from the bear market in 2022, would benefit greatly from it. There is a growing narrative about the possible institutionalization of Bitcoin, drawing comparisons to the early 2000s adoption of Gold exchange-traded funds (ETFs).
The SEC Chairman Confirms “New Look” At Applications
The SEC chairman Gary Gensler has recently asserted that the commission is taking a “new look” at the pending Bitcoin Spot ETF applications. Gensler’s assertion points to the idea that the SEC may be trying to proceed with the applications appropriately at the moment.
He referred to the Commission’s previous rejection of applications, but that it was forced to change its mind once the court became involved. This is because of the court’s decision in the Grayscale case when it ruled in favor of the firm’s $GBTC conversion over the SEC’s decision.
The asset manager’s claim that there is a correlation between the futures and spot markets was accepted by the court in the Grayscale case. Consequently, this has compelled the SEC to reevaluate Grayscale’s application and possibly other issuers.