On Tuesday, bitcoin gained about 10%, reaching $34,872, its highest value in nearly 18 months. The increase came as anticipation regarding the introduction of an exchange-traded bitcoin fund (ETF) grew.
The positive trend has not only affected the larger cryptocurrency market but has also made an appearance in associated equities.
The market thinks that the US Securities and Exchange Commission’s (SEC) approval of a spot bitcoin ETF would fuel significant demand.
It is believed that such an ETF would provide previously cautious investors access to cryptocurrencies via the stock market, possibly bringing in a new wave of wealth.
Bitcoin, a highly volatile digital asset whose price has doubled this year, is currently trading at $34,020, its highest value since May 2022.
During Asian trading hours, it temporarily surpassed the $35,000 mark. Ether, the second-largest cryptocurrency, also saw increases, gaining 4.50 percent to $1,786.30, its highest value since August.
The influence of Bitcoin’s rise extends beyond the cryptocurrency sector. Shares in the cryptocurrency business, including major US exchange Coinbase Global and Bitcoin holding MicroStrategy, increased by more than 7% and 12%, respectively.
According to Reuters, Antoni Trenchev, co-founder of Nexo, “a sense of excitement has erupted in the crypto market, and now it’s just a case of waiting to see if and when a firm ruling emerges from the SEC.”
This spike in excitement about the impending approval of a Bitcoin ETF is strengthened by the presence of significant US financial organizations, including investment behemoth BlackRock, with pending ETF applications. According to reports, BlackRock’s iShares ETF has been posted on the website of clearing house DTCC, fueling suspicion even more.
Reuters reported earlier this month that the SEC will not dispute a court verdict accusing the agency of wrongly rejecting an ETF registration from cryptocurrency business Grayscale Investments.
The court confirmed its ruling on Monday, returning the application to the SEC for re-evaluation. According to Reuters, Geoffrey Kendrick, Standard Chartered’s director of digital assets research, “the SEC being pressured by the courts increases the chance of an ETF approval.”