Jihan Wu stands by Matrixport’s contentious Bitcoin ETF analysis amid market shakeup

Matrixport co-founder Jihan Wu took to social media to address industry concerns regarding the company’s recent report predicting the rejection of spot Bitcoin ETF applications by the SEC.

In his statement, Wu emphasized the independence of Matrixport’s analysts, stating that they operate without any influence or interference from management. He added that the analysts are valued for their analytical skills, which are considered superior to those of the management team.

He further clarified that the report was not influenced in any way by management and is based on independent research by the author.

Wu’s statement comes after industry backlash following the release of the report due to a lack of insider sources, with some claiming the report was part of a market manipulation scheme.

Prominent ETF analysts, in particular, claim the report is based on pure speculation as it conflicts with the information provided by sources within the SEC and the ETF hopefuls.

Wu also mentioned his limited involvement with the report, noting that he, like many others, had only briefly looked at its title. His statement aimed to clarify the company’s stance and reaffirm its commitment to providing independent, well-researched market analysis.

Backlash

The report — titled “Matrixport Analysis: SEC to Reject ETF Applications in January with Final Approval Pushed to Q2 2024” — led to a significant 7% price drop in Bitcoin, which fell from above $45,000 to below $42,100 in a matter of hours.

Matrixport’s report detailed several factors influencing Bitcoin’s price. It projected a rejection of spot Bitcoin ETF applications in the immediate term, with a potential approval being delayed until the second quarter of 2024.

The rejection claim quickly raised questions about the report’s veracity, with many — including Bloomberg analyst Eric Balchunas — asking the author Markus Thielen to confirm his source.

Thielen responded to Balchunas, stating:

“My report is not based on issuer, nor on SEC insider comments. Obviously this is massively out of consensus. I do think the SEC will vote it down. And yes, after being the biggest bull all year (predicted 45k by Xmas on Feb 1), I turned bearish today but the arguments were ready.”

Despite the forecasted regulatory setback, the report maintained a bullish outlook on Bitcoin’s price for 2024, citing historical patterns, the upcoming Bitcoin halving, and macroeconomic conditions.

Analysts say otherwise

Balchunas said that the report goes against the information given to him and many other journalists and analysts like James Seyffart, who have sources within the SEC. He added that the claim seems more like speculation as there is no concrete evidence to support it.

Balchunas further stated that the regulator would not be going back and forth in meeting with the applicants and exchanges over fixing their filings if the watchdog planned to reject the applications. He added that it would be far more efficient for the SEC to remain quiet and simply ask the applicants to resubmit their S-1 filings instead of updating and fixing the 19b-4 forms.

Fox journalist Eleanor Terret echoed his sentiments and reported that her sources had confirmed the SEC was meeting with all the exchanges — including Nasdaq, Cboe, and the New York Stock Exchange — involved in listing the upcoming ETFs.

The meeting’s primary purpose is to finalize the 19b-4s submitted by the spot BTC applicants, which is another positive sign.