Not a day has passed since Jim Cramer, a media personality best known for his hosting of CNBC’s “Mad Money,” stated that ‘you can’t kill BTC’ on air on January 2, when the world’s foremost cryptocurrency, along with numerous other coins and tokens, dropped significantly.
In fact, in a matter of minutes, Bitcoin (BTC) fell from above $45,000 to below $42,000 before whipsawing somewhat, wiping out approximately $60 billion from its market cap, which dropped from about $890 billion to $830 billion.
The cryptocurrency stands close to $42,100 at the time of publication.
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Nearly all notable cryptocurrencies – Ethereum (ETH), XRP (XRP), Solana (SOL), and Binance Coin (BNB), just to name a few – experienced a similar, sudden, and significant price drop on Wednesday, January 3. In total, an estimated $540 million was liquidated from the crypto market in a matter of hours.
Bitcoin ETF hopes and uncertainties
One of the major reasons Cramer – usually very bearish on cryptocurrencies – was more lenient on BTC in his Tuesday appearance is the rally driven by the wide expectations that the Securities and Exchange Commission (SEC) will approve a spot Bitcoin exchange-traded fund (ETF) in the first weeks of January 2024 after several years of rejection.
Since the New Year, there has been an uptick in chatter surrounding the approval, with some outlets reporting that it is likely to occur in the first days of 2024. Some reporters, like Fox Business’ Eleanor Tarret, however, cautioned on X that based on her information and understanding of the situation, the news will not come before January 4 or 5.
The generally optimistic tone was, however, broken on Wednesday when Matrixport, a financial services firm, published a document titled “Why the SEC will REJECT Bitcoin Spot ETFs again,” in which it not only argued that there would be no approval prior to the second quarter of 2024 but also that BTC is likely to fall as low as $36,000.
While the document is probably one of the driving forces behind the Wednesday Bitcoin and crypto market drop, the actual realities of a possible BTC ETF remain uncertain as other players in the industry – such as Bloomberg ETF Analyst Eric Balchunas – maintain the position that a January approval remains the most likely outcome.
Ultimately. the debate – along with the associated volatility – is likely to persist until the SEC officially replies to each of the many spot BTC ETF applicants.
BTC price analysis
Despite the sudden drop – totaling 7.56% by the time of publication – witnessed on January 3, Bitcoin’s price remains significantly above the levels seen throughout most of 2023. in fact, the world’s foremost cryptocurrency is up 154.74% in the last 52 weeks and stands at 42,160.00 at press time.
Similarly, despite losing approximately $60 billion from its market cap in a matter of hours, Bitcoin’s capitalization remains close to what can be seen with some of the largest-cap stocks at $827 billion.
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