The bullish momentum’s influence is not confined to the wider cryptocurrency market; it has also extended its reach to related stocks.
Bitcoin’s value skyrocketed to $34,872, a near 10 per cent increase and its peak value in almost a year and a half on Tuesday. This surge was fueled by increasing rumors regarding the inception of a Bitcoin exchange-traded fund (ETF).
The wider cryptocurrency market and related stocks have both felt the influence of the bullish momentum.
The approval of a spot bitcoin ETF by the US Securities and Exchange Commission (SEC) is expected to generate significant demand, according to market predictions.
The debate suggests that this kind of ETF might open up opportunities for tentative investors to approach cryptocurrencies through the stock exchange, which could trigger a substantial injection of capital into the industry.
Currently, Bitcoin, a digital asset with extreme price fluctuations that has witnessed its value doubling this year, is being traded at $34,020. This represents the highest value since May 2022.
In the course of Asian trading, the value momentarily surpassed $35,000. Ether, which is the second-most valuable cryptocurrency, also saw an increase in its worth by 4.50 per cent, hitting $1,786.30 – a peak not seen since August.
The increase in Bitcoin’s value has repercussions beyond just the cryptocurrency market. Equity associated with the crypto sector, like US-based Coinbase Global and MicroStrategy who owns Bitcoin, saw a rise of more than 7 per cent and 12 per cent respectively.
Antoni Trencher, co-founder of Nexo, a digital asset firm, was quoted by Reuters as saying,
“A sense of excitement has erupted in the crypto market and now it’s just a case of waiting to see if and when something concrete emerges from the SEC.”
The anticipation for a Bitcoin ETF’s approval is heightened due to the involvement of significant U.S. financial entities, such as BlackRock, which have pending ETF applications. It has been reported that BlackRock’s iShares ETF is listed on the DTCC clearing house website, which intensifies the speculation.
It has been suggested in several reports this month, one of which was from Reuters, that the SEC would not dispute a court’s ruling accusing it of improperly refusing an ETF application submitted by Grayscale Investments, a cryptocurrency firm.
The court finalised its ruling on Monday, returning the application to the SEC for a reassessment. Geoffrey Kendrick, who leads digital assets research at Standard Chartered, was cited by Reuters.
“The SEC being pressured by the courts increases the probability of an ETF approval.”
(With inputs from Reuters)