© Reuters
Investing.com – Cryptocurrency markets saw a sharp sell-off in the past hour. It saw a rapid drop of 10% from $45,000 to $40,750 within an hour.
The development that led to the sharp decline in cryptocurrency markets was a report released by cryptocurrency platform MatrixSport, indicating that the US Securities and Exchange Commission may reject spot bitcoin exchange-traded funds. The report asserted that Bitcoin could fall to $36,000 – $38,000 if a possible rejection occurs.
Although no official statement has yet been released by the SEC, the appearance of such a rumor has rattled the market and led to a sharp decline. Although there are high expectations in the market for the future of ETF approval, this report from MatrixPort seems to have had a big impact on the market.
However, some commentators argue that even if ETFs are approved, the initial reaction could be sell-side, leading to widespread selling. Some are also pessimistic as they believe that investor sentiment may weaken and regulatory pressures may increase.
As a result, although the SEC has yet to announce its decision, market volatility seems to have increased as the decision approaches. Volatility is likely to continue even after the decision.
Although the withdrawal rate in cryptocurrency markets is currently 12%, there are still negative market expectations. Bitcoin has recovered to $42,200 after falling to $40,750. On the other hand, it saw a rally towards $2,200 after falling to $2,100. In cryptocurrency futures markets, liquidated position volume reached $400 million in the last hour.
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