The Defiant

BTC Underperforms ETH and Altcoins As Investors Sell Bitcoin After ETF Approval

BTC ranks 99th among top 100 crypto assets for seven-day price performance

By: Samuel Haig Loading...

BTC Underperforms ETH and Altcoins As Investors Sell Bitcoin After ETF Approval

The price of BTC posted a double-digit tumble from last week’s local high, significantly underperforming ETH and other leading altcoins despite the first spot Bitcoin ETFs going live.

BTC last changed hands for $42,640, a 12% retracement from its Jan. 11 high of $48,500, according to CoinGecko. The bearish market action positions BTC as the second-weakest performing top 100 crypto asset by market cap over the past seven days.

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BTC/USD. Source: CoinGecko.

Bitcoin’s significant retracement comes despite the network gearing up for its  fourth quadrennial halving — which will reduce the rate of new BTC creation by 50% — in April. The event has historically preceded impressive price gains for BTC and other digital assets. It also follows the U.S. Securities and Exchange Commission  approving the first spot Bitcoin ETFs on Jan. 10.

Spot Ether ETF optimism

The price of Ethereum has held much stronger in spite of apparent  heavy sales from Celsius, the bankrupt centralized crypto lender, with ETH down almost 6% from its Jan. 11 local high of $2,700.

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ETH/USD. Source: CoinGecko.

Ethereum has benefitted from redirected ETF optimism, with pundits tipping Ether will be the next crypto asset greenlit for a spot exchange-traded fund by U.S. regulators.

Ark Invest and 21Shares teamed up to  file for a spot ETH ETF on Sept. 6 as bullish expectations for a spot Bitcoin ETF were surging after the U.S. District of Columbia Court of Appeals overturned the SEC’s decision to reject Grayscale’s application for a spot Bitcoin ETF one week earlier. Grayscale  filed for its own spot Ether ETF on Sept. 19, while  BlackRock, the world’s largest asset manager,  entered the fray on Nov. 15.

Following several  delays, the earliest  deadline for an SEC verdict on a pending spot ETH ETF application is currently set for late May. Traders speculating via Polymarket’s prediction markets currently estimate there is a  55% chance a spot Ether ETF will receive approval by May 31.

Ether is among 28 top 100 digital assets that posted double-digit gains for the week. Sui (SUI) topped the list with an 82.5% gain, followed by Ethereum Name Service (ENS) with 81%, Helium (HNT) with 49.7%, and Celestia with 43.9%.

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The widespread gains posted by digital assets suggest many investors have rotated significant capital from BTC into altcoins, rendering the launch of spot Bitcoin ETFs a sell-on-the-news event.

However, data from CoinMarketCap shows the combined crypto market cap pulling back by  $126B or 8.7% from its Jan. 11 high of $1.84T.

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