Bitcoin Slips to $27.2K, Cryptos Fall as Investors Digest Grayscale’s Court Win
Bitcoin (BTC) retreated from yesterday’s high above $28,000 on Wednesday as investors pondered the implications of Grayscale’s court victory over the Securities and Exchange Commission.
The largest cryptocurrency by market cap fell 2% in the last 24 hours to $27,240. Ether (ETH) was slightly better, down 1.7% in the last 24 hours and remaining just above $1,700.
The broader crypto market mirrored the performance of the top two assets, with the AskFX market index down 2.4%.
Cardano’s ADA, Solana’s SOL, and Polygon’s MATIC led the decline among major altcoins, falling nearly 4% on the day and erasing most of their Tuesday gain.
A federal appeals court yesterday ordered the SEC to dismiss investment manager Grayscale’s bid to convert its $14 billion Grayscale Bitcoin Trust (GBTC) into a spot bitcoin exchange-traded fund (ETF). , needs to review what prompted an immediate rally in digital asset prices and crypto-related stocks.
Market watchers hailed the decision as a game-changing victory that could potentially pave the way for a spot BTC ETF in the future. Over the summer, a number of investment firms applied or renewed their bid to list such a product, including traditional financial giant BlackRock. However, yesterday’s ruling does not automatically guarantee approval of Grayscale’s or any other company’s application.
How sustainable is the BTC rally?
Although it’s too early to tell how sustainable Tuesday’s price jump was, “there are some small signs that we could see a slight reversal,” said Clara Medalie, research director at Kaiko, in an interview.
Notably, the rally was accompanied by modest trading volumes on exchanges compared to other “mini-bull markets,” which only hit two-week highs, Medalie said. Trading volume represents market participants’ commitment to the market, she explained, so the weak volume number could indicate some weakness behind the move.
However, average BTC buy orders surged to their highest levels since June, suggesting activity from large investors, which Medalie rated as “good news.”
“A wave of ETF approvals could definitely be the bullish catalyst the crypto market needs right now,” she said, adding, “We are still in the midst of a turbulent time for the industry, which has seen numerous bankruptcies and lawsuits.”
Market analyst Garreth Soloway predicted a further drop in Bitcoin price if it fails to break the $28,000 level it was trading at prior to the mid-August sell-off. to break clearly.
The support level to watch is around $25,000, the price at which Bitcoin was in mid-June when Blackrock applied for a spot BTC ETF, Soloway added.
