Spot Bitcoin ETFs: A week of high stakes and expectations

As a decision on Bitcoin ( BTC ) exchange-traded funds (ETFs) nears, aspiring crypto businesses, investors and regulators are taking definitive steps to best prepare for the unknown.

Total weekly outflows from various Bitcoin short investment products have exceeded $1 million, and the Crypto Fear and Greed Index has tipped into the “extreme greed” zone. Moreover, Standard Chartered has predicted Bitcoin will reach $200,000 by 2025 if the spot BTC ETF gets approved.

Bitcoin short ETPs record $1M weekly outflow, anticipating spot BTC ETF approval

While digital asset investment products, or exchange-traded products (ETPs), saw inflows of $151 million in the first week of 2024, outflows from Bitcoin short positions totaled over $1 million .

Earlier, many market pundits predicted that the potential approval of the BTC ETF could be a “buy the rumor, sell the news” event, but the latest digital asset investment flow data contradicts that claim, with significant outflows in the past several weeks.

Bitcoin index tips into ‘extreme greed’ as market holds breath for ETFs

The Crypto Fear and Greed Index signaled “extreme greed” market sentiment among crypto investors. According to the Crypto Fear Greed Index, Bitcoin’s market sentiment score is 76 out of a possible 100 — its highest score since Bitcoin hovered around its highest price of $69,000 in mid-November 2021.

The Bitcoin sentiment index briefly tipped into “extreme greed” on Dec. 5 at a score of 75. Bitcoin broke the $40,000 mark on Dec. 4 and surged to $44,000 a day later.

Before that, the index last swung to “extreme greed” on Nov. 11, 2021, when it scored 77. According to data, Bitcoin reached its all-time high price only a day earlier.

Standard Chartered tips $200K Bitcoin by late 2025 if ETFs approved

Multinational bank Standard Chartered has forecast that Bitcoin could reach nearly $200,000 by 2025 end if BTC ETFs are approved and successful as investment products.

Standard Chartered posting some moon math! $200,000 coming pic.twitter.com/IQueMhjgiP

— Lark Davis (@TheCryptoLark) January 9, 2024

“If ETF-related inflows materalize as we expect, we think an end-2025 level closer to USD 200,000 is possible,” said Standard Chartered's head of digital assets Geoff Kendrick and precious metals analyst Suki Cooper in a Jan. 8 report, which has been shared on X (formerly Twitter).

The bank’s price prediction assumed that between 437,000 and 1.32 million BTC would be held in United States-listed spot Bitcoin ETFs by the end of 2024. The firm estimates this to equate between $50-100 billion in inflows.

Hashdex spot Bitcoin ETF left out of amended S-1 filings — What does it mean?

While multiple asset managers filed S-1 form amendments on Jan. 8 as part of the process to receive approval for listing shares of a spot BTC ETF fund on United States-based exchanges, crypto asset management company Hashdex didn’t issue an amended form .

Also, as others have pointed out there is no update here from @hashdex yet. But they are different from the rest of the pack solely because they're the only product on this list that is already operating as an ETF. So I'm not gonna read too much into that yet.

— James Seyffart (@JSeyff) January 8, 2024

According to Bloomberg ETF analyst Jeff Seyffart, Hashdex’s Bitcoin ETF application differed from those of other firms in that it was applying to convert an existing crypto futures ETF. Hashdex submitted its application to the SEC in August, proposing a futures investment vehicle that could also hold spot Bitcoin.

Gary Gensler issues warning on crypto ahead of potential spot Bitcoin ETF approval

SEC Chair Gary Gensler called on crypto investors to keep some things in mind as many asset managers await the final word on approval or denial of their spot BTC ETF applications.

1⃣ Those offering crypto asset investments/services may not be complying w/ applicable law, including federal securities laws. Investors in crypto asset securities should understand they may be deprived of key info other important protections in connection w/ their investment.

— Gary Gensler (@GaryGensler) January 8, 2024

Despite uncertainties around the SEC’s decision to approve one or many BTC ETFs at the same time, applications are in for Valkyrie, WisdomTree, BlackRock, VanEck, Invesco and Galaxy, Grayscale, ARK Invest and 21Shares, Fidelity, Bitwise and Franklin Templeton.

Explore 'Gary Gensler's ETF Dilemma' in our latest comic! As the ETF decision day nears, can Gary Gensler keep saying no? Share your thoughts below! pic.twitter.com/ujSOkz0Sg6

— Cointelegraph (@Cointelegraph) January 4, 2024

The S-1 filings on Jan. 8 were expected — part of a deadline from the SEC following many 19b-4 filings on Jan. 5. While both suggested a forward move for the SEC to allow crypto ETF listings on U.S. exchanges, they do not guarantee approval.