After the SEC made purchasing bitcoin simpler two weeks ago, a lot of people began selling it.

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    Since the US government authorized ETFs trading in cryptocurrencies, bitcoin has dropped by 15%.

    The announcement a few weeks ago by the US Securities and Exchange Commission that it had authorized the use of the investment instrument created a great deal of enthusiasm around the possibility of exchange-traded bitcoin funds. The SEC’s social media account on X was even compromised by someone to leak the information ahead of schedule! However, the excitement hasn’t resulted in a price increase for the cryptocurrency.

    According to the Financial Times, since the SEC approved ETFs on January 10, when ordinary investors could more quickly enter and exit the commodities market than if they had to figure out how to buy them directly, the price of bitcoin has dropped by 15%. For the first time since early December, the price is currently under $40,000.

    A portion of the fall can be attributed to Grayscale, the trust that was supposed to lead the way in bitcoin exchange-traded funds, now losing business to more affordable rivals. Customers of Grayscale pay 1.5% of their invested assets in fees; a BlackRock ETF that is comparable charges 0.12%. Grayscale has reportedly experienced withdrawals of $2.8 billion over the last two weeks, according to the Wall Street Journal.

    Very few people actually own much bitcoin, despite the fact that many people are still interested in it. Thus, significant changes have a disproportionate effect on price. According to a working study published in November by the National Bureau of Economic Research, bitcoin functions similarly to many other tradable assets. When the market sees a spike in value—bitcoin has increased by about 40% since rumors of the SEC considering to approve ETFs started to circulate in October—many investors want to sell while the going gets good.