We will be giving some macro economic market updates on a weekly basis. No equity recommendations will be given in this commentary, and we encourage you to contact us if you have questions regarding any observations.
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This weeks issue: Bitcoin price, Bitcoin spot ETFs, SEC and Bitcoin, Jim Cramer on Bitcoin, Fidelity, Elon Musk and X, X value collapses from Musk purchase price, Worlds richest men, U.S. regional banks, U.S. bank failures of 2023, Debt levels in the U.S., Federal interest expense expands, Congress market performance, Unusual whales tracking, Rise of autocracy, Autocracy versus democracy, Shipping stocks, Red Sea blockage, Freight rates, Maersk shipping, FED minutes, Money to retire in each U.S. state, Retiring.
Bitcoin’s milestone and flop
Crypto markets have rallied over the last year as investors have returned to the sector after a horrible 2022. 2023’s gains continued on January 2nd for most cryptocurrencies including Bitcoin. Bitcoin surged above $45,000 for the first time since April 2022. The crypto sector has been on a broad-based rally recently amid expectations that approval of Bitcoin ETFs will come as soon as this week. On Tuesday the price of Bitcoin jumped by more than $4,000 per coin.
The approval of a Bitcoin ETF by the Securities Exchange Commission is expected to bring billions to the asset class. Reuters claimed that the SEC may notify issuers of these ETFs as soon as Wednesday of approval and they could launch these Bitcoin ETFs as soon as next week. The agency for years denied such spot Bitcoin applications, but an appellate court last year said the SEC’s rejection of one such bid was arbitrary and capricious.
Among the issuers expected to launch Bitcoin ETFs are Fidelity, Blackrock and Invesco.
Analysts who cover the crypto industry claim that the approval of ETFs could help bring another $600 billion to crypto funds over the next 5 years. An analyst from Bernstein released a note on Tuesday that claims that Bitcoin will have a market cap of $3 trillion by the end of next year (triple today’s value). However, others believe this could be a sell-the-news moment for Bitcoin after a massive rally over the last 12 months.
However, on Wednesday morning, Bitcoin had given up its recent gains over the last few days on reports that the SEC would be rejecting issuers who applied to launch Bitcoin ETFs. Bitcoin was down 6.1% over the last day as of early Wednesday morning.