Solana Plummets 14% On Heels Of Spot Bitcoin ETF Delay Rumor, $640M Liquidation Cascade

Fears of a delay in Spot Bitcoin ETF approvals spurred the biggest cryptocurrency market dip in months.
What Happened: Bitcoin BTC/USD and Ethereum ETH/USD are down 7% and 7.6%, respectively in the past 24 hours. Bitcoin and Ether also witnessed an increase of 23% and50%, respectively, in trading volumes.

Solana SOL/USD plunged 14.2% in the same timeframe, with trading volumes expanding 34.5%.  

Notably, several crypto analysts on social media updated their trading plans based on a report from Matrixport that predicts the U.S. Securities and Exchange Commission (SEC) will not approve Spot Bitcoin ETF applications in January on grounds of the industry falling short of SEC Chairman Gary Gensler's expectations for compliance.

Joshua Jake, a crypto trader on X, stated: “There is a 90% Chance #Bitcoin ETFs are not approved by January 10^th.”

Jake plans to take 50% profit this week around the $46,500-$48,000 range as he has been dollar cost averaging throughout the entire bear market.

Another user, Teo, stated on X: “I think this drop is related to the #BitcoinETF ! Probably some insider knows something about a possible delay. I decide to stop trading until we have more clarity on this ETF. In the meantime, I hold strong all my spot bags.”

Doctor Profit highlighted on X: “How many times have I told you that approval will happen close before or after halving. Halving + ETF will send BTC to ATH.”

Matrixport sees no reason for the SEC to approve applications "from a political perspective."

The critical requirements "might be fulfilled by Q2 2024."

According to Coinglass, a crypto analytics website, over 188,000 traders were liquidated in the last 24 hours. Total liquidations stand at $644 million at the time of writing, with $570 million coming from liquidated long positions. This eclipses the last big liquidation cascade from Dec. 11, when $455 million in long positions were liquidated due to Bitcoin dipping from $43,800 to $41,700. The retrace comes only one day after CNBC analyst Jim Cramer revised his stance on Bitcoin.

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