Rumors of Bitcoin ETF approval typically boost market liquidity by attracting speculative trading and institutional interest. Increased volume from retail and hedge funds narrows bid-ask spreads, enhancing price efficiency. However, unconfirmed rumors can spike volatility, as seen in past false reports triggering rapid price swings. Investors often respond by front-running approvals, accumulating BTC to capitalize on anticipated inflows, while others hedge with futures or options to mitigate downside risk. Long-term strategies shift toward holding ETFs for diversified exposure, reducing direct crypto custody needs, though skepticism persists until official confirmation stabilizes sentiment.