Bitcoin Price Soars above $44,000 Amid Speculation of Spot BTC ETF Approval in 2024
Summary:
Bitcoin's price jumps over the $44,000 mark for the first time in 19 months, predominantly driven by speculation of a spot BTC exchange-traded fund (ETF) approval in January 2024, leading to a significant influx of institutional investments. Despite earlier market uncertainty following the DOJ settlement with Binance, the platform has seen renewed Bitcoin inflows against a backdrop of multi-year lows in Bitcoin deposits across all crypto exchanges. The ongoing bullish sentiment could trigger an substantial surge in demand and market capitalization if the ETF earns approval.
For the first time in over a year and a half, the price of Bitcoin (BTC) has seen a significant increase, surpassing the $44,000 mark. The primary driver behind this surge is the speculation that a spot BTC exchange-traded fund (ETF) will garner approval in January 2024. The anticipation has prompted an influx of massive funds from institutional investors.
BTC's impressive November performance, marking the best in the past 19 months, indicates sustained positivity towards the cryptocurrency among traders. Despite a previous wave of uncertainty following the guilty plea by former Binance CEO Changpeng “CZ” Zhao and subsequent $4.3 billion settlement to the U.S. Department of Justice (DOJ), the market seems to have regained its footing.
Notably, the Binance exchange has not seen a large-scale capital flight as evidenced by the FTX liquidity crisis. Industry leaders, including Galaxy Digital's CEO Mike Novogratz, view the DOJ settlement with Binance as a net positive. After initial outflows, the Bitcoin balance at Binance has started to rebound.
A research conducted by on-chain analytics firm, Nansen, indicated that it is business as usual for the world's largest crypto exchange, Binance. Interestingly, amid the lack of substantial capital flight from Binance, all crypto exchanges have been experiencing multi-year lows in Bitcoin deposits.
The promising turn around for Bitcoin continues with a year-to-date gain of 163.2%, despite various macroeconomic challenges. The optimists are adamant about the approval of a spot Bitcoin ETF and its impact on the crypto market. They back their belief with convincing evidence, such as the settlement deals between DOJ and other crypto platforms like BitMEX.
Regardless of Bitcoin's impressive strength and the endorsement of several investors, including BlackRock, Fidelity, and ARK Invest, the Securities and Exchange Commission (SEC) remains resistant to the idea of approving a spot Bitcoin ETF.
However, the positive market sentiment accompanying Bitcoin has fueled its market cap, enabling it to surpass that of Berkshire Hathaway. This achievement puts Bitcoin in the enviable position of becoming the 10th largest asset globally in terms of market cap.
According to CryptoQuant analysts, the approval of a Bitcoin ETF could spur a $600 billion surge in demand and increase Bitcoin's market capitalization by $1 trillion. Furthermore, Galaxy Digital anticipates a 74% price rise within a year post-ETF approval. The next window for potential SEC approval of a spot Bitcoin ETF is between January 5 and 10, 2024.
Despite the lingering anticipation of a Bitcoin ETF, institutional investors have continued to show interest in Bitcoin and other cryptocurrencies, ploughing a total of $1.76 billion into the crypto sector in the last year. Over the past week alone, Bitcoin has witnessed a $132.8 million inflow from institutional investors.
Published At
12/5/2023 10:50:52 PM
Disclaimer: Algoine does not endorse any content or product on this page. Readers should conduct their own research before taking any actions related to the asset, company, or any information in this article and assume full responsibility for their decisions. This article should not be considered as investment advice. Our news is prepared with AI support.
Do you suspect this content may be misleading, incomplete, or inappropriate in any way, requiring modification or removal?
We appreciate your report.