Crypto news: Bitcoin above $26,500. Will SEC approve BlackRock Bitcoin Trust? 💵

The cryptocurrency market has managed to recover some of the losses of the past few days, but it is still difficult to talk about a significant rebound. The best performer is Bitcoin, which is trading around $26,500, near key resistance zone. The main topic of the crypto market in recent days has been the move by BlackRock (BLK.US), the world's largest investment fund (about $9.1 trillion AUM), which unexpectedly, last Thursday filed with the SEC for approval of the Bitcoin Trust. The market in the US is closed today due to a national holiday, so volatility as well as liquidity in the crypto market may be limited until Wall Street opens.

BlackRock iShares Bitcoin Trust news highlights:

• According to Bloomberg, BlackRock's application is the 30th attempt to approve in the SEC a fund that would buy bitcoins from the market, on behalf of shareholders. In this aspect, the Bitcoin Trust is thus similar to a spot ETF fund. The standard waiting time for SEC decisions in similar cases is about 270 days;
• The history of ETF applications filed by BlacRock looks 'optimistic' for Bitcoin Trust - as many as 575 iShares ETFs have been approved, the SEC has rejected only 1;
• Cryptocurrency exchange Coinbase (COIN.US), with which BlackRock is already partnering on institutional cryptocurrency invesoters, would hold digital assets, and BNY Mellon Bank (BK.US) would hold investor funds;
• Similar requests from many funds like Fidelity, VanEck and WisdomTree were rejected by the SEC, with regulators citing unverifiable 'price manipulation' in the underlying market.
• However, the SEC indicated in its responses that an exception could be made if it shared control of the market (shared supervision). BlackRock's proposal is pointing directly to this aspect - as the proposal reads, oversight of the iShares Bitcoin Trust would be obtained by the Nasdaq exchange and Coinbase.

BlackRock would make exposure to Bitcoin much easier for many investors, and potentially make it much safer as well, which could support growth. The fund is known for its political connections to the Democratic Party by which the market perceives the move as a signal that cryptocurrencies in the US will not face a complete 'ban' after all. As a matter of principle, the SEC as well as the CFTC agree that BTC is a commodity - making the creation of a Bitcoin Trust currently much more likely to succeed than an adequate product for other cryptocurrencies. Adequately, however, it is worth considering that a possible rejection by the SEC could have negative repercussions for crypto.

Last week, on Thursday, BTC price rose after news of the iShares Bitcoin Trust application. Now the price is in the vicinity of $26,300. Bitcoin was one of the few assets to surprisingly gain during the spring 'banking crisis' in the US.  The situation in the U.S. financial sector remains uncertain although the crisis has stabilized, and the Federal Reserve is likely to provide banks with the necessary tools in the event of another iteration of the crisis. Source: BloombergBITCOIN, H4 interval. The price has encountered resistance in the form of the SMA200 (red line), and as long as it is below it ($26,600) the base scenario is downward momentum. The MACD indicates the potential for another bearish 'crossover'. Resistance at $26,600 is all the stronger if we consider the 38.2 Fibonacci retracement of the April upward wave, which runs right at this level. A potential breakout above it could support increases towards $28,200 (23.6 Fibo) and psychological resistance at $30,000, respectively. If problems with a breakout above the 38.2 Fibo continue, a test of the 61.8 abolition near $24,000 remains a possibility. Source: xStation5