Business Maverick

Business Maverick

Bitcoin Hits $35,000 for First Time Since 2022 on ETF Optimism

Bitcoin Hits $35,000 for First Time Since 2022 on ETF Optimism
The Bitcoin logo on souvenirs during the listing ceremony for the CSOP Bitcoin Futures and CSOP Ether Futures exchange-traded funds (ETFs) at the Hong Kong Stock Exchange in Hong Kong, China, on Friday, Dec. 16, 2022. A pair of Hong Kong ETFs investing in Bitcoin and Ether futures raised $79 million as the city pushes ahead with a plan to become a crypto hub even as the sector globally reels from the FTX collapse. Photographer: Paul Yeung/Bloomberg

Bitcoin retreated from the more than one-year highs that were fueled by expectations of fresh demand from exchange-traded funds.

The largest digital asset rose as much as 11.5% to top $35,000 before paring some of the gain to trade at $33,517 as of 11:43 a.m. in New York on Tuesday, taking its year-to-date rebound from 2022’s digital-asset rout to 102%.

The possible approval in coming weeks of the first US spot Bitcoin ETFs is stoking speculative ardor for the token. Asset managers BlackRock Inc. and Fidelity Investments are among those in the race to offer such products. Digital-asset bulls argue the ETFs would widen adoption of the cryptocurrency.

Rally | Bitcoin spiked more than 11% on Tuesday and scaled $35,000

A US federal appeals court on Monday also formalized a victory for Grayscale Investments LLC in its bid to create a spot Bitcoin ETF over objections from the US Securities and Exchange Commission.

Read more: Grayscale Gets Court Order in Fight With SEC on Bitcoin ETF

The SEC has so far resisted allowing ETFs that invest directly in Bitcoin, citing risks such as fraud and manipulation in the underlying market. The court ruling and flurry of applications from investment heavyweights to start spot funds stoked speculation that the agency will relent.

ETF Ticker

Bloomberg Intelligence ETF analyst Eric Balchunas on Monday flagged on X, the platform formerly known as Twitter, that the iShares Bitcoin Trust “has been listed on the DTCC” with the ticker IBTC. The listing appears to have been taken down, Balchunas said on Tuesday.

“Not totally shocked, my guess is they were told to or want to wait until they are days not weeks or months away,” Balchunas said. “As I said yest, it was surprising to see it on there.”

BlackRock, the world’s largest asset manager, operates the iShares business. The DTCC is the Depository Trust and Clearing Corp., which undertakes clearing and settlement in US markets.

Bitcoin also surged 10% intraday at the start of last week on ETF hype. On that occasion, an erroneous report that BlackRock had won approval to launch a fund caused the move and the rally cooled once the mistake came to light.

Ether, the second-largest token, jumped as much as 8.5% to briefly exceed $1,800 in Bitcoin’s slipstream on Tuesday. Smaller coins such as BNB, XRP and meme-crowd favorite Dogecoin initially climbed sharply before moderating.

Coinglass data shows that about $387 million worth of crypto trading positions, mostly from speculators who were betting on lower prices, were liquidated in the past 24 hours.

Why Crypto Is Counting on Spot Bitcoin ETFs: QuickTake

SEC Clampdown

The SEC has already allowed ETFs that hold Bitcoin and Ether futures. But the agency overall has intensified a crypto crackdown following last year’s market crash and blowups like the bankruptcy of the FTX exchange, whose co-founder Sam Bankman-Fried is on trial for fraud.

Bloomberg Intelligence analysts Elliott Stein and James Seyffart have said “approval of a spot Bitcoin ETF looks inevitable” and that a batch of funds is likely to be given the green light, though the timing remains uncertain.

Bitcoin remains below its pandemic-era, 2021 peak of almost $69,000, squeezed by rising interest rates that hit demand for risky assets. The token’s correlations with assets such as stocks, bonds and gold have ebbed lately, stoking questions about whether mainstream investors have disengaged.

“Liquidity is somewhat better than before,” said Justin d’Anethan, head of business development in the Asia Pacific at crypto market maker Keyrock. “Prices have now recuperated and with it a certain amount of liquidity — still nothing compared to the euphoria of 2020-2021, though.”


Comments - Please in order to comment.

Please peer review 3 community comments before your comment can be posted

[%% img-description %%]

The Spy Bill: An autocratic roadmap to State Capture 2.0

Join Heidi Swart in conversation with Anton Harber and Marianne Merten as they discuss a concerning push to pass a controversial “Spy Bill” into law by May 2024. Tues 5 Dec at 12pm, live, online and free of charge.

A South African Hero: You

There’s a 99.8% chance that this isn’t for you. Only 0.2% of our readers have responded to this call for action.

Those 0.2% of our readers are our hidden heroes, who are fuelling our work and impacting the lives of every South African in doing so. They’re the people who contribute to keep Daily Maverick free for all, including you.

The equation is quite simple: the more members we have, the more reporting and investigations we can do, and the greater the impact on the country.

Be part of that 0.2%. Be a Maverick. Be a Maverick Insider.

Support Daily Maverick→
Payment options