Bitcoin jumps to 21-month high with ETF approval seen imminent
BITCOIN rose above US$47,000 for the first time since April 2022 with United States regulators seen as being poised to approve exchange-traded funds (ETFs) that invests directly in the digital asset for the first time.
BlackRock, Ark and several other prospective issuers of ETFs filed amended forms earlier on Monday (Jan 8) in what is seen by analysts as a final push to offer the investment products more than a decade after the first application was filed.
The original digital currency gained as much as 6.2 per cent to US$47,007, the biggest intraday increase since Nov 15. Bitcoin, which surged almost 160 per cent last year in anticipation that the US Securities and Exchange Commission (SEC) will approve the applications, is surging towards levels not seen since before the collapse of the crypto sector in the second half of 2022. The token hit an all-time high of almost US$69,000 in November 2021.
“The bullish movement for Bitcoin is almost certainly a response to the very high likelihood that we see spot ETF approval this week,” said Greg Moritz, co-founder and chief operating officer at crypto hedge fund Alt Tab Capital.
Fidelity, Invesco and Galaxy Digital and WisdomTree were among other firms that filed amended S-1 applications with the SEC. The regulator has until Jan 10 to take action on at least one of their applications, and crypto insiders have speculated the regulator will use that date to announce a slew of decisions at once.
SEC chair Gary Gensler issued a warning on Monday on the social media platform X about the risks that often come when investing in crypto.
“Billions of dollars of crypto long positions were liquidated last week when an analyst report suggested SEC will reject this week,” said Teong Hng, chief executive at crypto investment firm Satori Research. “Bullish reports today, by the likes of Standard Chartered Bank estimating between US$50 to US$100 billion of inflow into Bitcoin ETF this year adding fuel to the rally.”
Other smaller cryptocurrencies were most higher, with Ethereum up about 3.8 per cent, and Cardano, Solana’s SOL and Polkadot up anywhere from 7 to 9 per cent. Bitcoin accounts for a little more than half of the crypto’s US$1.7 billion market capitalisation.
Shares of so-called crypto companies were mostly higher. Coinbase Global, the largest US crypto exchange gained about 2.3 per cent, while Bitcoin miners Marathon Digital and Riot Platforms were both up more than 7 per cent. MicroStrategy, the software maker which has served as a proxy for many equity investors who want expose to Bitcoin, fell about 1.2 per cent. BLOOMBERG
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