The cryptocurrency market has been in a state of flux recently, driven by the expected approval of spot bitcoin exchange-traded funds (ETFs). Speculation surrounding these bitcoin-based products, including unsubstantiated news of BlackRock’s (NYSE:BLK) ETF approval and its premature listing on the DTCC’s August 2023 list, has led to notable price increases. This pattern is a classic example of the “buy the rumor, sell the news” phenomenon.
ChatGPT, which uses a ‘pay-per-prompt’ GPT-4 API, has projected that the approval could potentially push bitcoin’s market cap over $673 billion. However, it also noted that much of this increase may already be priced into current prices due to market anticipation.
The AI pointed to the approval of a bitcoin futures ETF in 2021, which coincided with bitcoin’s all-time high of $69,000. It suggested that a similar growth trajectory could follow the approval of spot bitcoin ETFs. However, he also cautioned investors about potential volatility around the time of the announcement and the influence of broader macroeconomic factors and reactions within the larger crypto market.
In addition to these predictions, ChatGPT warned of a potential two-year bear market marked by significant sell-offs from institutional investors, bitcoin miners and retailers who have been accumulating bitcoin for several months. This prediction underscores the need for investors to prepare for potential volatility and carefully consider their investment strategies in light of these developments.
