Steemit Crypto Academy Contest / S15W3 : Bitcoin ETF! What impacts?

Hi , Greetings to Everyone

I sincerely hope that everyone enjoys the educational themes of the Steemit Engagement Challenge S15-W3. subsequently, the competitors' epic entries under the designated subject. I was eager to learn more about this new topic, so I did some research and shared my own opinions with you all. I hope that my contribution will also be valuable.

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What is a Bitcoin ETF, and how does it differ from owning bitcoins directly?

In simple words, An exchange-traded fund (ETF) that monitors the price of bitcoin is known as an ETF. Without actually holding Bitcoin, investors can purchase and sell shares of the exchange-traded fund (ETF) on conventional stock exchanges to obtain exposure to changes in the cryptocurrency's price.

The following are differences from directly possessing bitcoins:

• You possess shares of the fund rather than the actual bitcoins when you invest in a Bitcoin ETF. You are in charge of and in possession of the real cryptocurrency when you personally hold bitcoins.

• You bear the responsibility of protecting your private keys when you are directly holding bitcoins. For the benefit of investors, the fund provider stores and safeguards the bitcoins in an ETF.

• Since Bitcoin ETFs are traded on conventional stock markets, a wider variety of investors—some of whom may find direct ownership complex—can access them more easily.

While directly holding bitcoins gives you direct control and accountability over the cryptocurrency, a Bitcoin ETF provides a more conventional investment vehicle with the ease of stock trading.

How can the approval of a Bitcoin ETF by the commissioner of the American Stock Exchange SEC influence the cryptocurrency market? And why did it fall just after this approval?

Well accordingly to the research on given theme, I came to know that the cryptocurrency market may be significantly impacted if the U.S. Securities and Exchange Commission (SEC) approves a Bitcoin ETF. How to do it is as follows as mentioned below as

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• The SEC's approval indicates how mainstream financial markets view Bitcoin in terms of legitimacy and acceptability. This may draw mainstream users and institutional investors, thus raising the demand for Bitcoin.

• A Bitcoin ETF offers traditional investors—who might be reluctant to deal directly with cryptocurrencies—a more approachable and familiar investment vehicle. A greater level of market engagement may result from this enhanced accessibility.

• Bitcoin's price may rise as a result of positive emotion surrounding the adoption of an ETF and investors' expectations of more demand. On the other hand, a rejection could result in a brief dissatisfaction of the market and a possible decrease in price.

And why did it fall just after this approval?

Well , In response to the inquiry about a decline following approval, it is important to remember that price movements are frequently intricate and that a variety of factors might affect market reactions. A post-approval drop may occur for a number of causes, including as mentioned below as

• Pre-approval prices may have increased because traders expected the approval. Following the official approval, some investors would sell to profit, which would result in a brief fall.

• The market may react more than it should due to the early enthusiasm surrounding an approval. As the market adjusts to more reasonable expectations, there may be more corrections.

• Events outside of the market, such as changes in regulations, macroeconomic trends, or the state of the world economy, can affect market movements.When examining post-approval price changes, it is critical to take investor behavior and the larger market situation into account. The short-term changes in cryptocurrency markets, which are notoriously volatile, can be impacted by a multitude of variables.

How could the approval of a Bitcoin ETF by a financial authority such as the SEC contribute to the legitimacy and institutional recognition of cryptocurrencies?

SEC approval of a Bitcoin ETF adds credibility, making institutions more comfortable investing in cryptocurrencies. It signals that regulators recognize crypto as a legitimate asset, fostering trust and encouraging broader participation in the market.In general, institutional acceptance, widespread adoption, and the general development of the cryptocurrency sector all depend on the regulatory approval of a Bitcoin ETF.

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How might the introduction of an SEC-approved Bitcoin ETF interact with the decentralized governance of the STEEM blockchain, and how might these two approaches complement or diverge in investors' perspectives on asset management? digital assets?

The decentralized governance of the STEEM blockchain and the launch of a Bitcoin ETF with SEC approval are two distinct strategies. The Bitcoin ETF follows conventional financial laws, but STEEM's decentralized governance incorporates the inherent autonomy of blockchain technology.

how might these two approaches complement or diverge in investors' perspectives on asset management? digital assets?

A Bitcoin ETF with SEC approval may be viewed by investors as a regulated, low-risk alternative for digital assets. However, STEEM's decentralized governance provides a more active and riskier approach. While some may cherish the security provided by rules, others may place a higher value on the flexibility and the benefits of decentralized control over their digital assets.

Well we can concluded that The decentralized governance of STEEM and the SEC-approved Bitcoin ETF accommodate various investor tastes. Whereas the later adopts blockchain concepts, the former provides regulatory conformance. Risk appetite, opinions on decentralization, and intended degree of asset management engagement will probably all play a role in investors' decisions.

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^{In the end, I would like to invite my Steemit fellows @drhira @suboohi @irawandedy @goodybest to take part in this informative engagement challenge and share your valuable feedback. Thanks}

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Kind Regards 💐 @uzma4882