Bitcoin [BTC] erased last week’s gains as traders de-risked before and after the Fed rate decision, which happened on the 18th of March.
After surging 15% to a local high of $76K, partly boosted by the escalating West Asia crisis, BTC reversed and dumped by 10% in the past three days. And ETF investors led the risk-off move.
In the days that followed, the Spot BTC ETFs recorded a $323 million in net outflows, breaking the inflow streak seen in the past seven days of trading.
But the BTC pullback has since hit a key 50-day Simple Moving Average (SMA, blue), with another support zone just above $65K. These could offer a new base for bulls to regroup, but it is unclear whether the levels will be defended ahead of next week’s mega quarterly Option expiry.
Morgan Stanley files an amended S-1 for spot BTC ETF application
Meanwhile, Morgan Stanley has submitted an amended S‐1 registration to the SEC, including the MSBT ticker for its spot BTC ETF application.
In its initial application in January, the bank listed Coinbase and BNY Mellon as custodians. Coinbase would handle the prime brokerage while Mellon would act as a cash custodian.
If approved, Morgan Stanley would be the first major U.S. bank to directly issue its spot BTC ETF. It would join Canada’s Scotia Bank, which has also opted to directly offer crypto ETF products.
For Morgan Stanley, crypto adoption was ‘still early,’ with Amy Odelnburg, the firm’s head of crypto strategy, noting current demand only coming from self-directed investors and not accounts managed by advisors.
Even the distribution of these ETFs, about 80% of what we see on our platform, is coming through the self-directed business.
For his part, Bloomberg ETF analyst James Seyffart noted that the amendment meant MSBT would debut soon.
Paul Atkins clarifies SEC’s interpretation of crypto assets
Finally, SEC Chairman Paul Atkins has clarified the agency’s crypto plans after the recent interpretation of crypto assets, which deemed most digital assets as non-securities.
For Atkins, this was ‘just the beginning,’ stating that the guideline would act as a bridge as Congress tries to advance the broader market structure bill, the CLARITY Act.
He added,
Our rules must be clear enough to guide markets, flexible enough to accommodate innovation, and firm enough to protect investors.
But he cautioned that the ‘token taxonomy’ was just the agency’s interpretation, and the court may challenge or ‘deviate’ from it. Even so, he committed to following up on the guidance with a proposal rule and sandbox for exemption to advance innovation.
We’ll shortly follow up with a proposed rule to put much more of this into effect. And construct a series of exemptions, equivalent to a sandbox for people to experiment and develop a proof-of-concept for their products.
Final Summary
- BTC’s pullback eased at $70K following a der-risking move led by ETF investors after a $323M in outflows
- SEC chair said the agency will soon make proposed rules related to the recent interpretation of the crypto assets framework.
