Highlights:
- Several theories emerge when Bitcoin’s price takes a sudden and steep dive.
- A co-founder of Ceni Capital predicted a Bitcoin price lower than $29,000, anticipating the SEC would postpone its decision regarding the ARK Bitcoin ETF.
- Ceni has pointed to BlackRock as a potential instigator of Bitcoin’s crash.
- Launching a spot Bitcoin ETF might not align with BlackRock’s broader interests.
- BlackRock’s priority is maintaining market stability and investor confidence.
- Regulatory approval plays a critical role in launching any financial product.
- Instilling investor confidence is important when introducing a Bitcoin ETF.
- The idea of government regulation as a reason for Bitcoin’s price drop is less likely.
- Betting against the price of BNB might not be as simple as it sounds.
- Most of these theories make assumptions and simplify things, ignoring the complexity of cryptocurrency markets, exchanges, and regulations.
Introduction
Numerous theories emerge whenever the price of Bitcoin takes a sudden and steep dive. The usual suspects include government regulations, the possibility of exchanges manipulating prices, Bitcoin (BTC) whales manipulating prices, overleveraged traders, and some conspiracies involving Tether (USDT).
SEC kicks Bitcoin ETF can down the road
Between Aug. 15 and Aug. 18, Bitcoin’s price experienced a significant 12% decline. The prediction made by Ceni, a co-founder of Ceni Capital, turned out to be partially accurate. Ceni predicted a Bitcoin price lower than $29,000, anticipating the SEC would postpone its decision regarding the ARK Bitcoin exchange-traded fund (ETF).
Spot Bitcoin ETF is not a short-term deal for BlackRock
BlackRock has built a reputation as a respected financial institution based on its commitment to market stability and investor confidence. A sudden and substantial drop in Bitcoin’s value could undermine the overall credibility of the cryptocurrency market, something BlackRock would aim to avoid. The priority of maintaining the market’s legitimacy might outweigh any immediate gains resulting from a low Bitcoin price. Additionally, obtaining regulatory approval plays a critical role in launching any financial product, especially within the cryptocurrency domain. Instilling investor confidence is of paramount importance when introducing any investment product, particularly a novel one like a Bitcoin ETF. Therefore, BlackRock’s interest likely lies in launching the ETF during a period of positive sentiment, where investors feel confident about the potential for future gains.
If not BlackRock, who’s to blame for the BTC price drop?
The next possibility often considered when trying to explain a drop in Bitcoin’s price is the idea that the government will regulate the cryptocurrency sector. Usually, these theories suggest that steps would be taken to control stablecoins and exchanges that are located outside the United States. However, it is challenging to track government wallets, and their influence on the whole market is limited. Betting against the price of BNB might not be as simple as it sounds, as traders would need to borrow it, and they can’t do that on regulated platforms.
Conclusion
Most of these theories make assumptions and simplify things, ignoring how complex cryptocurrency markets, exchanges, and regulations are. While the public might never know the truth for sure, it is reasonable to dismiss such theories as BlackRock crashing Bitcoin before a spot Bitcoin ETF approval.
This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
