Bitcoin dips 1.5% ahead of next week’s expected decision on spot ETF: CNBC Crypto World

CNBC Crypto World features the latest news and daily trading updates from the digital currency markets and provides viewers with a look at what’s ahead with high-profile interviews, explainers, and unique stories from the ever-changing crypto industry. On today’s show, Noelle Acheson, author of the Crypto is Macro Now newsletter, discusses what was behind crypto’s turbulent start to 2024.

Chapters:
00:00 – CNBC Crypto World, Jan 5, 2024
0:24 – Bitcoin and ether drop
1:29 – The headlines
4:23 – Noelle Acheson

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Bitcoin dips 1.5% ahead of next week’s expected decision on spot ETF: CNBC Crypto World

Today Bitcoin reverses course trading lower to end a volatile week new research reveals hackers linked to North Korea stole $600 million in crypto in 2023 an economist Noel aters explains the Catalyst driving crypto’s wild swings in price this week welcome to cnbc’s crypto world I’m T mckel crypto prices in the red to

Close out the first week of 2024 as if noon Eastern coin dropped more than 1.5% to just above $43,000 one day after the cryptocurrency crossed the $44,000 level as a spot Bitcoin ETF decision by the SEC is expected any day now ether dipped 2 and a half% and salana fell back below the

$100 Mark a little bit of volatility coming back into the market this week again as the anticipation of a spot Bitcoin ETF approval grows we’ll talk more shortly about what to expect with noal aeson for the week Bitcoin Rose more than 3 % however ether fell nearly

4% and salana sank about 8% xrp and Doge both dropped a whopping 10% and then over on the equity side Crypt Focus stocks had a bad week with coinbase sinking 11 a. half% crypto miners Riot and clean spark fell to with Riot dropping nearly 62% for the week and

Clean spark down more than 10 1 12% marathon and micro strategy however were slightly in the green for the week all as of noon Eastern okay let’s talk about the top stories Celsius is gearing up to unstake millions of dollars in ether on Thursday the company announced on X that it will

Unstake existing eth Holdings to offset summer restructuring costs the company is in the process of reorganizing its business to exit bankruptcy brought on by the 2022 crypto meltdown Celsius plans to focus on Bitcoin mining going forward and in the meantime it’s been using staking rewards as a way to cover

Costs as It prepares to repay customers according to nonsense Celsius has a total of about 2 6,000 e tokens awaiting withdrawal that’s worth nearly $459 million next hackers tied to North Korea stole $600 million in crypto in 2023 that’s according to research by trm Labs out today which noted that despite a 30%

Drop from the $850 million Hall in 2022 the Democratic People’s Republic of Korea or dprk was responsible for nearly a third of all funds stolen in crypto hacks last year trm also said that nearly $3 billion worth of crypto has been lost to North Korea link tax since

2017 noting that the dprk’s moneya laundering methods constantly evolv to evade international law enforcement agencies the blockchain intelligence firm which helps financial institutions government agencies and companies detect crypto related Financial crimes warned that this year will’ll likely see more disruption from North Korea even with notable advancements and cyber security

Among exchanges and finally crypto companies have introduced risk assessments and and finance tests in response to strict new rules on the advertising of digital asset products in the UK coinbase crypto.com and other crypto exchanges are warning users in the region that they’ll need to start filling out risk assessments and

Investment questionnaires aimed at testing their financial knowledge the companies told users that starting Monday they’ll be required to complete a declaration about what type of investor they are and respond to a question a covering a range of aspects of financial services and regulation to continue using their platforms if they don’t

Disclose the information they won’t be able to trade crypto since the passing of a major package of financial services reforms in the UK firms that offer crypto must adhere to the same rules as those that govern traditional Financial Services coinbase spokesperson told CNBC that the changes were made to ensure the

Firm is meeting UK investor protection standards which require users to have the necessary knowledge to make informed investment decisions a crypto.com spokesperson gave similar reasoning for the move saying its changes were made primarily to ensure customers understand the risks of investing in crypto which is a key component of the important

Consumer protections being put in place by the FCA all right back to crypto markets for our main story prices have been turbulent since the New Year kicked off I spoke with Noel aters author of The crypto is macroon now newsletter to find out what’s behind the big swings and prices this

Week of course everything right now is about the ETF no one has a crystal ball but based on what is known what do you expect to happen next week I expect we’re going to get approval for the very first Bitcoin spot ETF it really is

Quite epic I mean just a few months ago most people that I knew were saying it’s not going to happen it’s not going to happen and now it looks like it actually will of course it’s not a done deal we can’t say 100% certain that we’re going

To get it next week but it would be really really aggressive move from the SEC were they to were they to pull the rug now I have been thinking a bit about what the worst case scenario would be obviously the worst case scenario would be the SEC being totally aggressive and

At the same time canceling the Bitcoin Futures ETF so that we couldn’t then say that it’s inconsistent they’ve never done that before though that is not not even a 1% likelihood if they really wanted to play dirty they could delay again that’s possible it would mean some

You know scrambling on the part of the arc ETF for instance maybe they’d have to refile who knows it’s most likely that the SEC will give the green light next week because not doing so is just going to create a colossal amount of work for the SEC which as they have

Often reminded us is underst starved yeah I was just about to ask what the what the impetus would be to play dirty at this point it would be the SEC not having read through all of the documents having perhaps some internal discussions they still want to have or perhaps just

Being thoroughly pissed off with the entire industry I’m not saying that the SEC is unprofessional but um that would be the empet the most practical reason would be that they haven’t had time to go with the documents but again I think that’s very unlikely the most practical

Thing to do now the most efficient and the safest politically for the SEC is just to approve these already there was a survey out by bitwise I don’t remember if it was yesterday or the day before I thought it was really interesting a survey of advisors um and my takea away

From it was that many advisors are still thinking there is not going to be an approval um but that if there was they would be very interested in helping their clients allocate through an ETF what did you make of that survey we do have to bear in mind that

Most advisers don’t follow crypto most as we saw from the survey in fact which is an incredible document I recommend everyone read it if they get if they can it shows that most uh advisers are not interested in crypto something like 70% have not allocated uh clients to crypto

And no even more than that sorry something like 90% have not and 70% of those have no intention of doing so so they’re not following this obviously otherwise a much higher percentage than 40% would be would would believe that we do have one coming it is interesting

That many of them say those that are planning to allocate are waiting for an ETF well there’s a solution to that if I can throw in one more thing about that really interesting document you mentioned there Tanaya and that is the most interesting part of that always

Every year is the barriers to investment that is the key of this document for me anyway and the big takeaway this time that one of the key barriers which is lack of a liquid reliable exchange traded vehicle through which to get exposed well that barrier is probably

About to be removed and other barriers such as lack of regulatory Clarity there’s progress on that it’s slow and excruciating but it is progressing others are the volatility fair enough that’s what investors advisers have to you know take into account their clients needs and many of them can’t really

Afford the kind of vol fair enough but one takeaway my biggest takeaway from that list of the barriers is that there is still so much education that is needed in this space many investment advisers say that they would not allocate crypto for their clients because it’s a scam or because they

Don’t understand it or because it’s associated with ilicit trade that kind of thing there’s just a lot of Education that is still needed and here’s the big kicker the approval of Bitcoin spot ETF is going to kick that education onto a different kind of level different kind

Of Main stream acceptance when we see Bitcoin in the same frame in the same sentence in the same ad as names such as Black Rock invest Invesco Fidelity when Bitcoin becomes part of the mainstream Financial landscape that’s a different level of education and so we’ll see that

List probably change quite a lot between now and next year let’s get away from the ETF for a little bit um you know it’s been the ETF has been a big driver of Bitcoin price uh what do you make of the volatility in crypto this week which

Was not you know Bitcoin alone it seemed to be kind of a straight line up over the last couple of months at least that’s what it’s at least that’s what it felt like and then you know a little bit more tumultuous to kick off the new year

What do you make of it oh it’s welcome back volatility we’d missed it to be honest I mean the doldrums of the past two years I’ll guess I know 23 was a much better year than 22 remember before Black Rock filed their application how absolutely flat and stagnant it was in

The market last year absolutely and and even after after the initial flurry of excitement had died down volatility is not really back it’s a bit better but it’s not really back liquidity is not really back Kao put out their Q4 report recently which shows that liquidity in

Terms of Market depth has not yet recovered to pre FDX levels and hasn’t really moved that much even after the Black Rock announcement now this could change once the ETFs are launched because we do have some very big name authorized participants coming into the market and it’s going to be in their

Interest to do some Market making on bitcoin itself as well I presume so I do think this will change and that is going to start a whole new flywheel of investor demand the lack of volatility in you know contrary to what the bitwise survey is saying the lack of volatility for most institutional

Investors is a barrier bitcoin’s volatility to pick the largest currency as an example it’s a feature it’s not a bug for volatility um you know there’s risk so the volatility is what compensates the risk in outsize returns also volatility is what brings in liquidity because for many of the market

Makers if it’s not volatile they’re not really going to be able to cover their hedging cost so it’s just not worth their while high frequency Traders as well they need more volatility to be able to make money in the Bitcoin Market when they come back volatility will come

Back liquidity will come back and the market will start to recover the luster that it used used to have before everything went South in 2022 okay that’s all for crypto world this week we’ll be back again on Monday and we’ll see you then