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At a critical juncture, the tweet published by the SEC Chairman inevitably provokes deep thought...

On Tuesday, the price of Bitcoin once surged above the $47,000 mark, with the market optimistically believing that U.S. regulatory authorities will approve the first ETFs that allow direct investment in the world's largest digital asset.

The crypto market anticipates that a U.S. spot Bitcoin ETF will be approved before the deadline of January 10th. Potential issuers such as BlackRock, Fidelity Investments, and Ark Investment Management have updated their filings submitted to the SEC. According to requirements, the regulatory agency must take action on at least one of the applications before Wednesday local time.

Speculators are betting that the agency will announce a series of decisions simultaneously to avoid giving a "first-mover advantage" to a particular entity.

If the spot Bitcoin ETF is approved, the next question is how much capital these ETFs will compete for. Arca trader Kyle Doane stated, "Participants seem to be starting to believe that the initial capital inflows will actually exceed expectations."

SEC Chairman Gary Gensler has repeatedly argued that cryptocurrencies are rife with fraud and misconduct. After the collapse and wave of bankruptcies in 2022 (such as the bankruptcy of SBF's FTX exchange), the SEC has come down "heavily" on the industry.

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However, the SEC lost a key legal battle last year against the crypto asset management company Grayscale Investments LLC, sparking speculation that the regulatory agency will have to acquiesce to spot Bitcoin ETFs.

Furthermore, at this sensitive juncture, Gensler posted on social media on Monday to remind investors of the high risks and volatility of cryptocurrency assets, which inevitably raises doubts about whether the spot Bitcoin ETF is really coming. Gensler wrote:

"Investing in cryptocurrencies can be very dangerous and often unstable. Many major platforms and crypto assets have gone bankrupt, and investments in crypto assets will still face significant risks."

Although the SEC has the option to reject these applications, recent legal developments, such as a federal judge ordering the SEC to reconsider the previously denied spot Bitcoin ETF application from Grayscale Investments, indicate that any decision made by the regulatory agency will be closely scrutinized.However, critics argue that given the notorious volatility and attraction to illicit activities associated with digital assets, a spot Bitcoin ETF would pose risks to investors.

Dennis Kelleher, CEO of the financial reform non-profit organization Better Markets, said, "Unfortunately, in our view, what will happen is that a lot, a lot of Americans will be economically harmed as a result."

The months-long rally of Bitcoin has, more broadly, boosted the digital asset market, supporting smaller tokens such as Solana and Avalanche.

However, some cryptocurrency observers are wondering whether the news, if the SEC ultimately approves a Bitcoin spot ETF, could trigger a "wave of pullbacks," as speculators may decide to take profits.

Chris Weston, head of research at Pepperstone Group Ltd., wrote in a report that there is currently "no sign" of the so-called "sell the fact" event.

Tony Sycamore, a market analyst at IG Australia Pty, said that from a chart pattern perspective, $51,000 could be the target for Bitcoin before its price pulls back.