- Bitcoin Cash and Bitcoin SV prices bounced back in the overnight session.
- Franklin Resources filed for a new spot Bitcoin Exchange Traded Fund (ETF).
- These gains could be short-lived ahead of the latest US inflation data.
Bitcoin Cash (BCH) and Bitcoin SV (BSV) prices rose in the overnight session as investors reacted to the latest crypto ETF news. BSV jumped to a high of $32, much higher than this week’s low of $28.37. It is still down by more than 44% from its highest level in July. BCH price was trading at $200, higher than last month’s low of $163.
BCH and BSV risks remain
Bitcoin Cash and Bitcoin SV prices jumped after a short squeeze in the crypto industry pushed BTC price above $26,000. This was an important move since Bitcoin had moved below the key support at $25,000 a few days earlier. BCH and BSV tends to have a close correlation with BTC.
The trigger for the rally was the decision by Franklin Resources to file for a spot Bitcoin ETF with the SEC. Franklin is a major player in the financial services industry with over $1.5 trillion in assets under management. It is well-known for its Franklin Templeton and its Legg Mason companies.
Franklin joins other big Wall Street companies that are angling for a Bitcoin ETF. Blackrock, Invesco, Ark Invest, and WisdomTree have all filed for their spot Bitcoin ETF. Grayscale, on the other hand, is seeking to convert its GBTC Trust into a spot fund.
A spot ETF will help many institutional investors allocate money to Bitcoin in a safe environment. Analysts note that gold ETFs now manage billions of dollars, mostly from institutional investors.
If a BTC ETF comes online, it will likely open the floodgates of more crypto ETFs. The most logical one will be Ethereum, the second-biggest cryptocurrency in the world. Others that could follow are XRP, Bitcoin Cash, and Litecoin since they are not viewed as financial securities. A Bitcoin SV ETF will likely not happen because of its low volume.
What next for Bitcoin Cash and Bitcoin SV prices?
I believe that the BCH and BSV gains will be short-lived as we saw with other Bitcoin ETF applications.
Complicating the situation is that the US will publish the latest consumer price index (CPI) data as I wrote here. This is an important report because of its implication on the next actions by the Federal Reserve.
Most analysts believe that inflation ticked upwards in August as the price of gasoline jumped. This trend will likely continue now that crude oil price is in a strong upward trend with Brent trading at over $92 a barrel.
Therefore, I suspect that Bitcoin Cash price will retreat to about $190 while Bitcoin SV will drop to ~$28.
