Bitcoin, Ether down; Litecoin slips after halving event
Bitcoin, Ether and all other top 10 non-stablecoin cryptocurrencies dipped in Thursday morning trading in Asia. While Bitcoin and Ether price volatility remains low, analysts suggest turbulence is on the horizon due to the upcoming decision on BlackRock’s Bitcoin ETF application and next year’s Bitcoin halving event. Conversely, Litecoin — which had its own halving event on Wednesday — posted the morning’s biggest drop among top 10 cryptos. The Forkast 500 NFT Index was down, while U.S. equity futures gained, partially recovering from a dip during regular trading on Wednesday.
Anticipation building
Bitcoin lost 0.12% in the last 24 hours to US$29,171.97 as of 6:45 a.m. in Hong Kong, according to data from CoinMarketCap. The world’s largest cryptocurrency briefly fell below the US$29,000 support line to a low of US$28,946.51 overnight.
Ether also fell 0.35% to US$1,842.19 for a weekly loss of 1.50%.
Bitcoin and Ether’s price volatility is at an unprecedented low, said Luuk Strijers, chief operating officer at Panama-based crypto derivatives exchange Deribit.
“However, it’s important to note that the market anticipates a considerable upswing in volatility,” Strijers said. “This is largely driven by factors such as the upcoming ruling on the BlackRock spot ETF and the approaching Bitcoin Halvening.”
In June, BlackRock — the world’s largest asset manager — filed an application to list a spot Bitcoin exchange-traded fund (ETF) for the U.S. market. The U.S. Securities and Exchange Commission (SEC) formally accepted the application for review on July 13. The regulator now has a maximum of 240 days to accept or reject it.
Analysts at Bloomberg Intelligence this week upgraded their estimate for the chance the application would be approved from 50% to 65%, based on recent events including SEC chair Gary Gensler downplaying his role at the agency.
Earlier this week, six major U.S. asset managers including Grayscale and VanEck filed applications to launch ETFs for Ethereum futures.
“Now we are once again seeing a flurry of applications for futures-based Ethereum ETFs, including an inverse “short” ETF from Proshares,” said Bradley Duke, founder and chief strategy officer at crypto exchange-traded product provider ETC Group.
“There seems to be a growing acceptance at the SEC that crypto is an inevitable part of America’s investment landscape, and this is good news for crypto investors and service providers around the world,” Duke said.
Meanwhile, Bitcoin’s next halving event is expected to take place in April 2024. The halving event will see the amount of new Bitcoin issued every 10 minutes cut in half from 6.25BTC to 3.125 BTC, increasing its scarcity. This is widely anticipated to produce a surge in the token’s price.
However, professional market trader and finance author Peter Brandt predicted on Twitter last week that both the halving of Bitcoin and the “inevitable” approval of the BlackRock’s spot Bitcoin ETF in the U.S. will disappoint the optimists.
“Over 48 years of speculation I have learned again and again that markets discount events before the events are events,” wrote Brandt.
All other top 10 non-stablecoin cryptocurrencies by market capitalization were down.
Litecoin led the losses, falling 6.44% to US$87.37 and is down 2.83% for the week. The Bitcoin-inspired cryptocurrency completed its halving event on Wednesday, which cut mining rewards in half for the token. Bloomberg reported that a Litecoin price drop followed its two prior halvenings. That is the opposite effect of Bitcoin halving events, which tend to produce a positive impact on price.
Dogecoin also dipped 3.44% to US$0.07465 for a weekly decline of 4.35%. XRP also slipped 2.28% to US$0.6874, losing 4.16% in the past seven days as the shine comes off the recent ruling in favor of issuer Ripple in the case brought against it by the SEC.
The total crypto market capitalization fell 0.26% in the past 24 hours to US$1.17 trillion, while trading volume rose 9.49% to US$40.52 billion.
