U.Today - While the majority of experts and analysts are optimistic about the potential effects of Bitcoin ETF (TSX:EBIT) approval by the SEC, some speakers indicate potential threats it can bring, especially in the midterm. Is the euphoria around the Bitcoin ETF too overhyped?
ETF approval will be "sell-the-news" event for altcoins, Ran Neuner says
The weakness of altcoins in all segments is evidence that the market treats the potential ETF approval in the U.S. as a "sell-the-news" event. As such, it might kick-start a painful correction very soon, Ran Neuner, founder of Crypto Banter says on X.As such, he added, this dramatic weakness is a clear signal that the ETF trade that has been pumping the market for 203 days in now over. In a chart attached, he demonstrates that this frenzy started on June 16, 2023, with the U.S. heavyweight BlackRock (NYSE:BLK) filing for an ETF.
Once this narrative completely loses steam, the cryptocurrency markets might undergo a painful 20% correction. For instance, this can result in Bitcoin's (BTC) price dropping to $35,000 and Ethereum (ETH) dipping below $1,800.
At the same time, the overall trend remains bullish on high time frames: The potential 20% "flush out" will only indicate the start of the "next leg" for the crypto rally.
Since the announcement mentioned by Neuner, the aggregated capitalization of cryptocurrency markets jumped by almost 65%.
Why might Bitcoin ETF approval be bad for crypto?
Ran Neuner is not the only cryptocurrency expert who foresees bad effects Bitcoin ETF approval can bring to the digital assets sphere.BitMEX founder Arthur Hayes admitted that the Bitcoin ETF can be dangerous to the very nature of cryptocurrency as it makes it another "classic" asset, reducing the interest in physical BTC.
Also, Bitcoiner , echoing Hayes' concerns, adds that the move of value into Bitcoin ETFs will be dangerous to the legal status of Bitcoin (BTC) self-custody.
As such, the industry should be prepared for an “unwelcome surprise,” Keiser warns.