ETF approval rumors fuel positive market sentiment, increasing liquidity as new participants enter via exchanges and futures markets. This can create arbitrage opportunities between spot and futures prices, further enhancing liquidity. Investors may employ arbitrage strategies, buying spot Bitcoin and shorting futures, or use algorithmic trading to profit from rapid price movements. Long-term investors might increase HODLing, reducing circulating supply and amplifying price impact, while speculators sell into rallies to lock in profits.