According to Cointelegraph: Despite increasing anticipation surrounding a potential approval of spot Bitcoin exchange-traded funds (ETFs), ARK Invest CEO, Cathie Wood, suggests that the initial outcome could provoke a short-term sell-off in Bitcoin.
Wood argues that some investors, having netted handsome profits amid the "big anticipatory move" regarding the expected approval, may decide to "sell on the news." This classic trader's expression refers to the practice of driving up prices based on anticipation, then selling once the event happens.
However, Wood posits that any selling would be a short-term phenomenon. The long-term perspective remains promising, with the Securities and Exchange Commission's (SEC) potential approval of a spot Bitcoin ETF seen as a green light for institutional participation in Bitcoin.
Once such approval is granted, it would provide institutions with one of the easiest methods to access Bitcoin, potentially driving large allocations from trillions of dollars of institutional assets to Bitcoin. Wood believes that even a small allocation of 0.1% or 0.2% of institutional players' assets into Bitcoin could significantly push the price of the limited supply cryptocurrency.
ARK Invest, under Wood's leadership, is among the 14 firms that have applied for a spot Bitcoin ETF with the SEC. In collaboration with European crypto exchange-traded product provider, 21Shares, they have developed the ARK 21Shares Bitcoin ETF.
Discussions with the SEC about the spot Bitcoin ETF have been "very positive," says Wood, enhancing optimism about approval possibly coming as early as January. A change noticed in the last month to six weeks has seen the SEC move from silent denials to asking detailed, technical questions, a shift Wood views as a beneficial development for the acceptance of a spot Bitcoin ETF.
