BlackRock has more to lose from a BTC price crash pre-Bitcoin ETF

Quite a few theories emerge every time the price of Bitcoin (BTC) takes a sudden and steep drop. The standard suspects embody authorities laws, the opportunity of exchanges manipulating costs, Bitcoin whales manipulating costs, over-leveraged merchants, and a few conspiracies involving Tether (USDT).

SEC kicks Bitcoin ETF can down the street

Between Aug. 15 and Aug. 18, Bitcoin’s price skilled a vital 12% decline. This prevalence adopted a acquainted sample, prompting a number of causes put forth by analysts and consultants.

Sadly, due to the decentralized nature of cryptocurrencies and the dearth of transparency amongst exchanges, verifying whether or not a particular entity influenced the price motion stays a difficult activity.

On Aug. 11, Ceni, a co-founder of Ceni Capital, made a prediction that turned out to be partially correct. Ceni predicted a Bitcoin price decrease than $29,000, anticipating the U.S. Securities and Change Fee (SEC) to postpone its decision regarding the Ark Bitcoin ETF.

SEC Delays Determination on Ark Make investments’s Spot Bitcoin ETF Utility, Calls For Public Enter-8 week delay for BlackRock to manipulate the market. 29k ought to break quickly low-cost stats for holders and institutional traders. pic.twitter.com/pcBhOho0Ax

— CENI⬛️(,) (@ceni0718) August 11, 2023

Nevertheless, it is necessary to observe that the prediction did not specify the timing of this occasion or the precise assist degree. As a consequence, the statistical basis of this speculation turns into much less sure.

Nonetheless, Ceni has pointed to BlackRock as a potential instigator of Bitcoin’s crash, a declare that warrants thorough investigation.

Spot-based Bitcoin ETF will not be a short-term deal for BlackRock

The concept that BlackRock may profit from a decrease Bitcoin price earlier than launching a spot-based Bitcoin ETF will not be as simple as it could appear. Whereas the idea of a decrease Bitcoin price main to elevated profitability upon ETF launch may be intuitive, there are a number of the explanation why this won’t align with BlackRock’s broader pursuits.

Firstly, BlackRock has constructed a repute as a revered monetary establishment based mostly on its dedication to market stability and investor confidence. A sudden and substantial drop in Bitcoin’s worth might undermine the general credibility of the cryptocurrency market, one thing BlackRock would intention to keep away from. The precedence of sustaining the market’s legitimacy may outweigh any instant positive factors ensuing from a low Bitcoin price.

Secondly, acquiring regulatory approval performs a essential function in launching any monetary product, particularly throughout the cryptocurrency area. The SEC meticulously assesses the potential for market manipulation and safeguards for investor safety. Partaking in actions that could possibly be construed as price manipulation might jeopardize BlackRock’s probabilities of securing the mandatory regulatory approvals for his or her ETF providing.

Lastly, instilling investor confidence is of paramount significance when introducing any funding product, significantly a novel one like a Bitcoin ETF. A pointy Bitcoin price drop might erode belief amongst traders, not solely within the asset class itself but in addition within the ETF.

Subsequently, BlackRock’s curiosity possible lies in launching the ETF throughout a interval of optimistic sentiment, the place traders really feel assured concerning the potential for future positive factors.

If not BlackRock, who’s to blame for the BTC price drop?

The following chance typically thought-about when making an attempt to clarify a drop in Bitcoin’s price is the concept the federal government will regulate the cryptocurrency sector. This could possibly be pushed by causes like lowering demand to make the U.S. greenback stronger.

Normally, these theories counsel that steps can be taken to management stablecoins and exchanges which might be situated exterior the U.S. Market analyst Joe Kerr talked about this on X:

Tinfoil hat time:

Promote Authorities Bitcoin to Coinbase to suppress price.

Get Binance to defend BNB by promoting their Bitcoin.

Drain Binance’s low-cost Bitcoin and promote it to coinbase.

Binance goes broke & Coinbase has the vast majority of change Bitcoin (SSA req achieved).

Approve…

— Joe Kerr⚡ (@Boomstick44) August 18, 2023

Whereas this concept is fascinating, there are challenges and elements that make it appear much less possible. First, it is attainable to considerably track government wallets, however we must always keep in mind that governments normally have solely a small a part of all of the Bitcoin, so their affect on the entire market is restricted.

Associated: Bitcoin speculators are underwater on 88% of their BTC bags — Research

Betting in opposition to BNB price, and different nonsense

Subsequent, the concept of betting in opposition to the price of BNB won’t be so simple as it sounds. To wager in opposition to BNB, you’d want to borrow it, however you possibly can’t do this on platforms that comply with laws.

Furthermore, by checking Binance’s transparency page, you possibly can see in real-time whether or not their Bitcoin wallets are getting smaller in contrast to different exchanges.

This might counsel uncommon issues just like the improper use of buyer cash or monetary issues. Precise knowledge from these observations is more necessary than simply guessing, because it offers us perception into how effectively the change is doing.

In the end, most of those theories make assumptions and simplify issues, ignoring how advanced cryptocurrency markets, exchanges, and laws are.

The actual outcomes could possibly be very completely different from what’s instructed, so whereas we’d by no means know the reality for certain, we will at the very least dismiss such theories as BlackRock crashing Bitcoin earlier than a spot-Bitcoin ETF approval.

This text is for basic info functions and isn’t meant to be and shouldn’t be taken as authorized or funding recommendation. The views, ideas, and opinions expressed listed here are the writer’s alone and don’t essentially replicate or signify the views and opinions of Cointelegraph.