The anticipation for the approval of a Spot Bitcoin ETF has increased even more after former SEC Chairman Jay Clayton stated that an approval is "inevitable." Additionally, the Crypto Fear and Greed Index surged to 'Extreme Greed,' reflecting the Bitcoin ETF optimism in the crypto market at the moment. Amidst this, the notorious Lazarus Group, linked to the North Korean government, has resumed its activities by moving more than $1 million in Bitcoin. This movement coincides with an influx of amended filings from Bitcoin ETF hopefuls to the SEC, which could suggest an acceleration in the approval process.
SEC Nears Historic Approval of Bitcoin ETF
The excitement about the possible approval of Spot Bitcoin ETFs has reached a fever pitch after the recent statements from Jay Clayton, a former chairman of the United States Securities and Exchange Commission (SEC). In an interview with CNBC on Jan. 8, Clayton expressed his conviction that the approval of a Bitcoin ETF is not just possible but "inevitable."
For a decade, the SEC has consistently rejected applications for a spot Bitcoin ETF. The main concerns have revolved around issues of market manipulation and fraud. However, Clayton's recent comments suggest a significant shift in perspective. He believes that the underlying market dynamics for Bitcoin have improved greatly over the past five years, making the approval of a Bitcoin ETF not just likely but "imminent."
Clayton acknowledges the developments made in the infrastructure necessary for the proper custody and security of Bitcoin, which now aligns more closely with the needs of traditional financial market participants. He believes this is a critical factor in making Bitcoin much more accessible and manageable in the conventional financial framework.
The former SEC chair also highlighted the broader implications of this development beyond the realm of cryptocurrencies. He praised the growth in blockchain technology, especially its potential in tokenizing and trading real-world assets. According to Clayton, this is not just a significant step for Bitcoin but a transformative moment for the finance sector as a whole.
On Jan. 8, a flurry of amended S-1 and S-3 filings from hopeful Bitcoin ETF issuers was submitted to the SEC. Bloomberg ETF analyst James Seyffart views this influx of filings as a sign that the SEC is expediting the approval process. Despite these ongoing amendments, Seyffart still reassured investors that this should not be seen as a delay in the ETF's approval. Instead, this is just the final few steps in a long-awaited journey towards Bitcoin ETF approvals.
Crypto Fear and Greed Index Hits 'Extreme Greed'
The excitement surrounding the SEC’s decision regarding Bitcoin ETFs is clear in the fact that the Crypto Fear and Greed Index has recently entered the "extreme greed" zone. The Crypto Fear & Greed Index has reached a score of 76 out of 100, a level of optimism that has not been seen since mid-November of 2021, when BTC was trading near its all-time high price of $69,000.
This isn't the first time that the index has hit high levels like this. On Dec. 5, 2023, the index briefly reached a score of 75, right about when BTC broke the $40,000 mark before surging to $44,000 the next day. Before this, the index reached a similar peak on Nov. 11 of 2021, with a score of 77, just as Bitcoin hit its all-time high price.
The Crypto Fear and Greed Index incorporates data from six key market performance indicators. These include volatility, which accounts for 25% of the score, market momentum and volume (also 25%), social media sentiment (15%), surveys (15%), Bitcoin's dominance (10%), and trends (10%). By analyzing these data points, the index provides a daily score that reflects the overall sentiment in the Bitcoin market.
Lazarus Group Resurfaces: Coincidence?
Criminals also seem to be getting their affairs in order before the SEC’s decision deadline tomorrow. The North Korean hackers known as the Lazarus Group recently resumed its financial activities, moving over $1 million worth of BTC on Jan. 8, after a period of inactivity. Blockchain analysts from Arkham Intelligence reported that the group transferred about 27.371 BTC, valued at approximately $1.2 million, in two separate transactions. It is suspected that these transactions originated from a cryptocurrency mixer. Additionally, the Lazarus Group then moved 3.343 BTC, worth around $150,582, to a previously inactive address that they have used in the past.
After these transactions, Arkham Intelligence's analysis revealed that the Lazarus Group's portfolio held an eye-watering $79 million. While the specific intentions behind these transfers are still not clear, activity like this could suggest that the group is gearing up for more activity.
The Lazarus Group, which is allegedly backed by the North Korean government, has been a big name in the world of cybercrime. In 2023 alone, they were responsible for a third of all hacking incidents, collecting up to $700 million. Their tactics are notoriously sophisticated, and even sometimes include the use of fake job offers and impersonating well-known venture capitalists to fool their targets.
Between 2017 and 2023, it is believed that the Lazarus Group stole around $3 billion. This includes the infamous Ronin Bridge hack in March of 2022, where they got away with over $600 million in Ether (ETH) and USD Coin (USDC) from Axie Infinity, a play-to-earn game developed by Vietnamese studio Sky Mavis. This is considered to be the largest heist in the history of crypto.
Luckily, the activities of the Lazarus Group have not gone unnoticed by international authorities. In response to the Ronin Bridge incident, the United States Treasury Department’s Office of Foreign Assets Control (OFAC) took significant steps, including the unprecedented sanctioning of a crypto mixer, Blender.io. Following this, OFAC also sanctioned Tornado Cash and other individuals linked to the Lazarus Group. Hopefully, this is enough to deter the cyber criminals from trying to “take” their piece of the Bitcoin ETF cake.
