- The arrival of spot Bitcoin (BTC) exchange-traded funds (ETFs) in the US has paved the way for new market dynamics for the leading cryptocurrency by market cap, according to a South Korean analyst from Korbit crypto exchange.
- The result of the recent general elections in the country is seen as a major turning point in its crypto rules.
New Trend in Bitcoin Building Up
Gone were the days when Bitcoin traversed its own direction. Thanks to the approval of spot ETFs based on the digital asset, it is now moving in tandem with stocks and even traders as well as bots are viewing it as such.
According to the interview of Korbit Research Center head Kim Min-Seung with KyunHyang Games, US stock traders already have a major influence on the price movements of Bitcoin. The analyst said that the price trends of the leading cryptocurrency by market cap are no longer just confined to the BTC miners and whales.
Kim attributed the key shift to the US Securities and Exchange Commission’s (SEC) approval of spot Bitcoin ETFs on January 11. For him, the new dynamics of the digital asset have become more stock-centric as it moves in tandem with other spot ETFs in the US.
The Korbit official also noted that BTC appears to be deviating from its mere reliance to “macro market factors” such as “interest rates, pandemics, policies, and wars.” In the past couple of months, the crypto has tended to follow trends in spot Bitcoin ETFs and the stock market.
The significant rise and fall in BTC’s prices has aligned with the market hours of the US stock exchange. Even crypto trading bots have adopted the same buying and selling patterns. Furthermore, Bitcoin and other crypto futures markets have started exhibiting the same behavior, which has led to long and short liquidations.
Like most analysts, Kim is bullish on the increase of institutions adopting Bitcoin. However, he explained that retail investors still dominate the BTC market in South Korea. Although institutional investors in the country have begun showing interest in the digital currency, he stated that he has yet to see their entry into the crypto market. At present, the Asian country has an ongoing ban on the institutional ownership of crypto, which prevents asset managers, banks, and other similar entities from entering the Bitcoin ETF market.
Kim believes the factors mentioned, coupled with the Bitcoin halving coming around April 20, will likely “create synergies to increase Bitcoin prices.”
South Korea Promises Softer Stance on Cryptocurrencies
The 22nd general election in South Korea on April 10 resulted in a decisive victory for the opposition, the Democratic Party (DP). One of the major promises of the party is an overhaul of the country’s cryptocurrency regulations to appeal to the younger and tech-savvy voters. Even the ruling party, the People Power Party (PPP), vowed to do the same.
So, with the elections over, it’s time to get back on the promises of the politicians making up the major parties of South Korea’s legislature.