The prices of Bitcoin, Ethereum and all other major cryptocurrencies are sharply down Wednesday following an announcement by the U.S. Security and Exchange Commission (SEC) that it will postpone the decision on approving what would be the first-ever Bitcoin ETF.
A document posted by the SEC Tuesday says it has received more than 1,300 comments on this proposal; the regulator found it “appropriate to designate a longer period within which to take action on the proposed rule change so that it has sufficient time to consider the proposed rule change.”
In July, the SEC extended the deadline for deciding on Direxion’s Bitcoin ETF proposal to September 21, with similar reasoning.
These delays aren’t overly negative for Bitcoin; in fact, given that one SEC commissioner dissented from the regulator’s decision to reject the Winklevoss brothers’ proposal for a Bitcoin ETF, the fact that the SEC needs more time to make a decision on another proposal might be a positive sign for Bitcoin proponents.
However, it appears that anything resembling bad news can send the crypto market plummeting these days. Shortly following the announcement, the price of Bitcoin dropped by more than 6% and is currently trading at $6,580. Ethereum, the second largest cryptocurrency by market cap, fared even worse, having dropped by more than 8% at one point. It’s currently trading at $375, its lowest level since April. Ripple, Bitcoin Cash and EOS — the third, fourth and fifth largest coins by market cap — have all dropped more than ten percent in the past 24 hours.
The market capitalization of the entire cryptocurrency market is also sharply down at the time of writing. At $230 billion, it’s at its lowest point since November 2017.
Despite short periods of optimism here and there, the prices of Bitcoin, Ethereum and most other major cryptocurrencies have been on the decline since their January highs, when the total crypto market cap was over $800 billion. The launch of a Bitcoin ETF would likely be a big boost for Bitcoin and other coins, as it would open the doors to institutional investors to invest in the crypto market.
Disclosure: The author of this text owns, or has recently owned, a number of cryptocurrencies, including BTC and ETH.