Bitcoin Surges Past $34,000, Reaches Highest Level Since May 2022.
In a remarkable turn of events, the price of Bitcoin has surged past the $34,000 mark, reaching its highest value since May of the previous year.
This impressive surge is attributed to rising optimism regarding the potential approval of a Bitcoin exchange-traded fund (ETF).
According to data from Coin Metrics, Bitcoin was trading at $34,596.40 during the Asian morning hours on Tuesday, reflecting a substantial 4.97% increase.
The positive sentiment surrounding Bitcoin also had a significant impact on Ether, the second-largest digital coin, propelling it to its highest level since August, as indicated by Coin Metrics data.
The surge in Bitcoin’s price was described as the result of approximately $167 million in short liquidations, primarily on offshore exchanges.
Ryan Rasmussen, an analyst at Bitwise Asset Management, stated, “I don’t think anyone expected the level of price action we’re seeing, and those investors who were shorting Bitcoin in the $33,000 plus range are certainly feeling the pain of that surprise today.”
One of the key factors driving this surge is the mounting anticipation of a Bitcoin ETF, which gained traction after a court ruling favored Grayscale, a crypto-focused asset manager, over the U.S. Securities and Exchange Commission (SEC). The ruling pertained to Grayscale’s ambitious endeavor to transform its extensive Grayscale Bitcoin Trust (GBTC) into an ETF.
Last week, the SEC chose not to appeal the ruling by a significant deadline, sparking hopes that a Bitcoin-related ETF might be granted approval in the coming months. Such an ETF would provide investors with a vehicle to participate in Bitcoin’s price movements without directly owning the cryptocurrency itself.
Major financial institutions, including BlackRock, Invesco, Fidelity, and Grayscale, have been fervently advocating for Bitcoin ETFs. They have submitted applications to offer these assets, positioning them as safer investment alternatives compared to direct cryptocurrency investments known for their speculative nature and price volatility.
The crypto industry is closely monitoring these developments, as they could signify a resurgence. Over the past year, the sector has been marked by scandals, high drama, and legal challenges, such as FTX’s bankruptcy and charges against Terraform and its CEO Do Kwon for defrauding investors. Bitcoin’s price reached an all-time high in November 2021, surpassing $65,000.
However, a year later, the value experienced a sharp decline to around $16,000. The ongoing SEC crackdown on crypto firms, including Coinbase and Ripple, has added to the sector’s turbulence. These companies have criticized the U.S. for the lack of regulatory clarity and even threatened to move their operations abroad in response to the SEC’s actions.
Confidence is growing within the industry that a U.S. Bitcoin exchange-traded fund will eventually receive approval from the U.S. SEC, promising new avenues for investors looking to participate in the cryptocurrency market.
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