The Proshares Ultrashort Bitcoin ETF has been impacted by a mix of geopolitical and economic factors influencing Bitcoin's price. The Trump administration's announcement of plans to establish a national Bitcoin reserve has generated interest, suggesting potential regulatory support for cryptocurrencies in the U.S. This development is part of broader discussions with Congress aimed at creating a clear legal framework for digital assets, which could enhance Bitcoin's growth prospects. However, the market remains cautious due to tightening USD liquidity, as highlighted by Arthur Hayes, chief investment officer at Maelstrom. The increase in the U.S. Treasury General Account's cash balance is seen as a factor that could dampen Bitcoin's momentum.
Despite these developments, Bitcoin's price has faced downward pressure due to concerns over new U.S. tariffs on imports from Canada, Mexico, and China. These tariffs have raised fears of inflation and reduced the likelihood of a Federal Reserve rate cut, potentially impacting non-yielding assets like Bitcoin. Additionally, technical indicators suggest caution, with analysts at Matrixport noting that the Relative Strength Index (RSI) is not yet at a level that typically signals strong buying opportunities. This has led investors to adopt a cautious approach, waiting for more favorable entry points.
The Proshares Ultrashort Bitcoin ETF (SBIT) rose 2.48% to $10.32 as of 5:20 AM on Wednesday, February 5.