Polymarket ETF odds fell to 70%, BTC saw 8% flash crash amidst Matrixport prediction

Jan. 4, 2024

By Mike Dalton

Betting odds on Polymarket concerning the approval of pending spot Bitcoin exchange-traded funds (ETFs) briefly fell to 70% on Jan. 3.

On whether a spot Bitcoin ETF will be approved by Jan. 15, Polymarket displayed a “yes” outcome as priced at $0.70 at 1:30 p.m. UTC on Jan. 3. Polymarket data and various other reports suggested that a “yes” outcome was priced at $0.89 on Jan. 2. Current Polymarket data indicates that “yes” is currently priced at $0.84.

Bitcoin ETF approved by Jan 15? — Polymarket

So far, Polymarket users have bet $912,569 on this market, though it is unclear how many individuals have placed bets in total.

Contrarian report may be responsible for drop

The decline in Polymarket’s “yes” odds may be related to a contrarian report from Matrixport analyst Markus Thielen published on Jan. 3.

Thielen argued that the U.S. Securities and Exchange Commission (SEC) may reject all pending spot ETFs for political reasons. He noted that many SEC Commissioners are members of the Democratic party (which is often considered anti-cryptocurrency) and highlighted SEC chair Gary Gensler’s hostility to crypto. Thielen also asserted that pending applications do not currently meet a critical requirement but did not identify the requirement in question.

Polymarket’s odds nevertheless represent an overwhelming chance of approval. Its current 84% odds are roughly in line with a prediction from Bloomberg ETF analysts, who say there is a 90% chance that the SEC approves at least one ETF when it decides on Ark Invest’s application by a Jan. 10 deadline.

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