Bitcoin all-time high after ETF green light? Unlikely, say bettors

Even as crypto watchers are becoming bullish on the back of spot Bitcoin exchange-traded funds being approved, online punters are betting that Bitcoin will not beat its previous high.

Punters on Polymarket, a blockchain-based betting site that allows users to wager on binary outcomes, have put the odds at 22%.

Placed on December 14, the bet has gathered more than $211,000 in liquidity. It is set to expire on March 31.

There have been a few spikes over 50% in the bet’s history, but each turned out to be short-lived. DL News was unable to identify any events corresponding to the spikes.

Following Wednesday’s approval — when US Securities and Exchange Commission Chair Gary Gensler begrudgingly signed off on 11 spot Bitcoin ETFs and potentially cemented his own legacy — odds briefly increased to 30%, before retreating to 22%.

A look at other prediction markets shows similarly timid vibes for Bitcoin. Odds that the leading cryptocurrency will beat its November 2021 high of almost $69,000 by the end of the 2024 are about 49%, according to forecasting startup Manifold.

It’s likely that bettors’ behaviour on the prediction markets is an indication they are closely aligned with experts’ estimates.

Earlier this week, software engineer and crypto sceptic Molly White wrote in her newsletter that it was unlikely Bitcoin would jump following the spot Bitcoin ETF approvals.

Her reasoning? Analysts and journalists “have been describing an ETF approval as almost certain” for a long time, meaning the approval “would be more or less priced in by now.”

Even so, some industry experts do say that Bitcoin will reach an all-time high this year.

“I think we are going over six figures by the end of the year,” Meltem Demirors, head of strategy at CoinShares, told CNBC, highlighting two key reasons — the Bitcoin ETF approval and the halving event expected in April.

This sentiment echoes that of new ETF issuer Ark Invest’s Cathie Wood, who placed a $1.48 million price target for the coin in Ark’s Big Ideas 2023 report.

Bitcoin has rallied by more than 160% over the year. At the time of writing it was trading at just above $45,000.

So what are prediction markets?

Polymarket and Manifold are two examples of a new breed of prediction market in which users can, in Polymarket’s view, “profit from the things you know best.”

Both sites allow users to wager on different topics, looking also to produce meaningful insights into current events. The probability of each bet is determined by online voting.

Manifold users place bets with its play money, Mana, which can be converted only into charity donations or used to make future bets.

Polymarket works in a similar manner, but users bet with USDC, Circle’s stablecoin.

Both platforms allow users to place bets on a myriad of topics ranging from crypto to politics and beyond, and they have drawn scrutiny over controversial bets.

Those include the possibility of a nuclear exchange between Russia and the US amid the Ukraine War, the recovery of the Titan submersible after its collapse in June, or whether FTX founder Sam Bankman-Fried would be found guilty in his November trial.

In December, 17 people were arrested in Taiwan for placing Polymarket bets regarding the forthcoming national election, according to local media.

Polymarket and Manifold did not return requests for comment.

Tyler Pearson is a Junior Markets Correspondent at DL News. If you’ve got a hot crypto tip, please reach out at ty@dlnews.com.