Why Bitcoin's (BTC) Price Plunged This Week
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On Jan. 10, the U.S. Securities and Exchange Commission (SEC) approved the market's first 11 Bitcoin (CRYPTO: BTC) exchange-traded funds (ETFs). Unlike previous "Bitcoin ETFs," which were pinned only to future contracts or held shares of Bitcoin-related companies, these new funds directly hold Bitcoins. Over the long term, these ETFs should closely track the spot price of Bitcoin and represent a much easier way to invest in the cryptocurrency than stand-alone crypto wallets.
The SEC's approvals also represent a big vote of confidence in Bitcoin's future as a mainstream asset. But Bitcoin's price tumbled after the first batch of ETFs started trading on Jan. 11. As of Jan. 13, it trades at about $42,500 -- representing a near-10% decline in just five days. Let's see why its price dropped and where it might be headed over the next 12 months.
Image source: Getty Images.
Source Fool.com
