Weekly Market Wrap: Grayscale’s favorable court verdict, ETF hype fail to lift Bitcoin above US$28,000
Bitcoin fell 0.37% from Aug. 25 to Sept. 1 to US$26,012 as of 5 p.m. Friday in Hong Kong. The world’s largest cryptocurrency by market capitalization has been trading below US$30,000 since Aug. 9, according to CoinMarketCap data. Ether, the world’s second-largest cryptocurrency, fell 0.59% over the week to US$1,645.
This week started with positive news for crypto investors, after a U.S. court ruled in favor of Grayscale on Tuesday, reversing the Securities and Exchange Commission’s (SEC) earlier refusal to allow the company’s Grayscale Bitcoin Trust (GBTC) to be converted into a spot Bitcoin exchange-traded fund (ETF).
Over US$80 million worth of Bitcoin short positions were liquidated within an hour after Grayscale’s favorable ruling. Bitcoin rose to a two-week high of US$27,322 on Thursday, two days after the decision, but remained under the US$28,000 support level.
“The SEC losing both the Ripple and the Grayscale cases has provided the market with optimism that a spot ETF could be approved,” Lucas Kiely, the chief investment officer of digital asset platform Yield App, told Forkast.
“While it is likely that a Bitcoin ETF will eventually emerge in the U.S., the Grayscale news won’t break Bitcoin out of a current wedge pattern that dates back to the start of 2023.”
Mike Ermolaev, founder of blockchain PR firm Outset PR and the author of the interview series ‘Crypto Opinion with Mike Ermolaev,’ said that Grayscale’s legal victory can provide further regulatory clarity for the crypto industry.
“One of the key reasons why this is a big win is that it sets the stage for increased institutional adoption of crypto, with multiple applications pending from major U.S. asset managers,” wrote Ermolaev.
In other positive news for the crypto space, Pantera Capital, a hedge fund with over US$4.8 billion in assets under management, predicted that Bitcoin would rise to US$35,000 before the 2024 halving and reach US$148,000 in 2025.
Pantera’s prediction could come to fruition, considering that Bitcoin surpassed its previous all-time high in each bullish cycle following the halving, Nilesh Verma, crypto market analyst and founder of India-based Crypto Granth consultancy, told Forkast.
“If the trend follows suit, Bitcoin has the potential to reach anywhere between US$100,000 to US$200,000 by 2025,” wrote Verma.
Adiel Barzel, the co-founder of Crypto Index, agreed that Pantera’s price prediction may play out, despite the recent correction in Bitcoin prices.
“Even if Bitcoin ends 2023 in the current price range, or even slightly lower, I will still be bullish on [Pantera’s] price forecast, because, as mentioned, the significant upward movement is fully expected to begin during 2024 post-halving,” wrote Barzel.
The global crypto market capitalization stood at US$1.05 trillion on Friday at 5 p.m. in Hong Kong, maintaining the same value from a week ago, according to CoinMarketCap data. With a market cap of US$506 billion, Bitcoin represented 48.4% of the market while Ether, valued at US$197 billion, accounted for 18.9%.