Bitcoin prices have long been influenced by a variety of factors such as the activities of Bitcoin miners and BTC whales. However, according to Kim Min-seung, the head of the Korbit Research Center at the Korbit crypto exchange, the landscape has shifted in recent months. Kim claims that US stock traders are now playing a significant role in determining the price of Bitcoin.
SEC’s Impact
The decision by the Securities and Exchange Commission (SEC) to approve Bitcoin spot exchange-traded funds (ETFs) has created a new market dynamic, according to Kim. Previously, macro market factors such as interest rates, pandemics, policies, and wars had a major impact on BTC markets. However, the SEC’s decision in January has marked a turning point in the market.
Analysts have observed that the price of Bitcoin is now sensitive to trends in US spot ETFs. Trading bots in Asia and elsewhere have reportedly started following US stock traders and Bitcoin ETF trading patterns. This has led to Bitcoin prices rising or falling during US stock market trading hours, with similar trends being repeated during Asian market hours.
Kim predicts that there will be an inflow of additional institutions into the market. This influx could have a seismic effect on South Korea’s BTC market, which is currently dominated by retail investors. Many institutional investors and funds have shown interest in BTC but are yet to gain access to the markets. Kim believes that these factors, along with the upcoming halving event, are likely to create synergies that will increase Bitcoin prices.
Political Influence
At the time of writing, the Democratic Party in South Korea was poised to win a massive majority in parliamentary elections. The party has promised to pressure regulators to approve South Korean Bitcoin and altcoin ETFs. If this were to happen, it could have a significant impact on the country’s cryptocurrency market.
The influence of US stock traders on Bitcoin prices is a new and emerging trend in the market. With the approval of Bitcoin spot ETFs by the SEC and the changing dynamics of trading patterns, Bitcoin prices are now more closely tied to activities in the stock market. As institutions begin to enter the market and political developments shape the regulatory environment, the future of Bitcoin prices remains uncertain but potentially promising.