[Crypto] FTX liquidation | BTC spot ETF (Patreon)

Major events:

Overhang that FTX will liquidate assets to pay back creditors. Based on documents, FTX has a crypto portfolio of around $3.4bn dollars which needs to be liquidated based on court approval. The plan now is to have Galaxy help liquidate the portfolio at a clip of $100mn to $200mn per week, which is actually a lot of pressure in today’s market without much liquidity.  The market took a leg down on this news, and with the biggest hit impacting the tokens that’s known to be part of FTX’s portfolio including names like Solana. 

At the beginning of the month, U.S. court ruled in favor of Grayscale, overturning the SEC's previous decision to deny the conversion of the company's Grayscale Bitcoin Trust (GBTC) into a spot Bitcoin ETF. This is a big win for crypto given that the SEC’s chaotic treatment of crypto companies is finally being questioned by the courts.

The discount on Grayscale Bitcoin and Ethereum Trusts continue to narrow. In the past month GBTC moved from -25% to -17% (8 percentage point) and ETHE moved from -35% to -25% (10 percentage point)

Market

Volatility did indeed spike up after prolonged suppression. But it came as BTC collapsed below 29000 level

Despite the US court overturning SEC decision to block Grayscale ETF. SEC can still delay the approval process and that is pne of the reasons for the weakness in the market.

The market had high hopes for BlackRock’s entry into the ETF game given the publicity that Larry Fink brought to the table. Nonetheless, even BlackRock's ETF approval was delayed along with the other issuers without any special treatment. And as you can see below, SEC can in theory delay their decision until 1Q2024, so this could be a long waiting game.

Now BTC is trading on its longer term support of 25000. If it falls below this trading range, we may see it turn from uptrend to downtrend and retest 20000

Disclaimer: The content of this post is solely for entertainment and not investment advice. Any views expressed in the below are the personal views of the author and should not form the basis for making investment decisions, nor be construed as a recommendation or advice to engage in investment transactions