QCP Capital: Bitcoin ETF Liquidity Set to Surge After SEC Options Approval

According to Cointelegraph: On October 18, 2024, the United States Securities and Exchange Commission (SEC) approved applications from the New York Stock Exchange (NYSE) and Chicago Board Options Exchange (CBOE) to list options for spot Bitcoin exchange-traded funds (ETFs). This approval makes options trading available for 11 Bitcoin ETF providers, marking a significant milestone for the cryptocurrency market.BTC/USD, 1-year chart. Source: CointelegraphSurge in ETF Liquidity ExpectedThe approval is expected to significantly increase liquidity in Bitcoin ETFs, which have already seen strong institutional demand. QCP Capital, in an October 19 research note, emphasized the importance of this move, stating that ETF inflows will likely surge as a result:“The consistent inflows into the ETF highlight that institutional demand remains strong. With this morning’s SEC approval for BTC ETF options to be listed on the NYSE, we believe this will provide the ETF with the needed liquidity to attract sustainable inflows.”Bitcoin ETFs have already accounted for around 75% of new investment in the cryptocurrency, particularly in 2024 as Bitcoin surpassed the $50,000 mark. The additional liquidity from options trading could push Bitcoin to a new all-time high, surpassing its previous record of over $68,000.BTC/USD, 1-week chart. Source: Rekt Capital2024 US Presidential Elections: Risk-On SentimentAs the 2024 US presidential elections approach, QCP Capital anticipates a significant boost in risk-on sentiment, which could propel Bitcoin and other cryptocurrencies higher. The firm noted that risk assets typically rally during such periods of political uncertainty:“With US equities close to all-time highs and the Japanese yen on a fresh weakening trend, risk-on sentiment will only grow stronger as we approach the US election. This will propel risk assets higher and support our Uptober narrative.”Bitcoin is already benefiting from the increased risk appetite, with former President Donald Trump's odds of winning the election rising to 60.2%, according to recent reports.Bitcoin Eyes Weekly Close Above $68,700 for BreakoutTo confirm a potential breakout from its current trading range, Bitcoin must close the week above $68,700, according to popular crypto analyst Rekt Capital. The analyst noted in an October 18 X post:"On the cusp of confirming a breakout beyond the multi-month channel top resistance. A weekly close just like this would be bullish."This bullish sentiment is supported by positive ETF inflows, with Bitcoin ETFs surpassing the $20 billion milestone in total net flows on October 17. In contrast, it took Gold-based ETFs nearly five years to reach the same level.With the approval of Bitcoin ETF options, increased liquidity, and growing market interest, Bitcoin seems poised for a potential breakout as it approaches the $70,000 threshold.