Bitcoin Soars Over $44,000; BlackRock Secures Seed Funding for ETF Amid Bullish Crypto Market
Summary:
On December 5, Bitcoin's value surpassed $44,000 for the first time in 19 months, propelled by anticipation of a spot ETF approval by the SEC. Concurrently, BlackRock, the world's largest asset manager, secured $100,000 in initial funding for a Bitcoin ETF from an unidentified investor. Crypto-related stocks weathered a turbulent tech stock market, with companies like Coinbase and Bitcoin miners showing significant gains in 2023. Meanwhile, the U.S. Federal Reserve is anticipated to end its rate increase campaign amid soft inflation and a weakening job market.
On December 5, Bitcoin's (BTC) value increased, surpassing $44,000 for the first time in a year and a half. Concurrently, documentation from the United States Securities and Exchange Commission disclosed BlackRock obtaining $100,000 in initial funds from an unidentified investor for its Bitcoin exchange-traded fund (ETF). Despite a sea of turmoil in tech stocks, stocks related to cryptocurrency managed to stay afloat.
Bitcoin's lofty achievement on December 5 was worth over $44,000, thanks to the anticipation of SEC's approval of a spot ETF in the same year as BTC's next four-year halving event. According to information from Cointelegraph Markets Pro and TradingView, the top cryptocurrency attained a session high of $44,011. The value of Bitcoin has increased by approximately 15% over the last week.
Fueling the bullish trend is the forecast that the U.S. Federal Reserve will terminate its rate increase campaign due to slowing inflation and a declining job market. Material Indicators, an active trading source on X (formerly Twitter), stated that "optimism around the December Federal Rate Decision and the January ETF Decision could drive things up." The Fed’s last policy consultation of 2023 is set to happen between December 12 and 13, with a high likelihood that rates will not alter.
According to an SEC filing, BlackRock, the world's largest asset manager, received an initial investment of $100,000 for its Bitcoin ETF in October 2023 from an undisclosed contributor. The invested funds were agreed upon for the purchase of 4,000 shares, at $25.00 apiece which would see the investor acting as a statutory underwriter for the Seed Creation Baskets.
Details about BlackRock's strategy to pay the sponsor’s fee were disclosed in another filing. It plans to borrow Bitcoin (BTC) or cash as trade credit from the lender on a short-term basis, charging their fees via a loan. This ensures minimal impact on the Bitcoin price.
Cryptocurrency-related firms publicly traded have seen their percent returns escalate into the hundreds this year. These firms saw green on December 4 as Bitcoin touched a new high for the year, exceeding $42,000. To mention a few: Coinbase ended the day at slightly over $141, marking a 320% increase from the beginning of the year, and Bitcoin miners Marathon Digital and Riot Platforms ended the day with over 8% gains, recording 337% and 345% annual increases respectively.
In contrast to the robust cryptocurrency market, the broader North American stock market indicated a mixed performance. Major tech stocks, for instance, Microsoft, fell by 1.43%, Apple decreased by 0.95%, Google dropped by 2.02%, and Nvidia reduced by 2.68% on the same day.
Tony Sycamore, IG Australia market analyst, claims that the rally in cryptocurrency-related stocks is driven by recent impressive gains in Bitcoin value, nearing $42,000 after a 152% year-to-date increase.
This story does not offer investment guidance or suggestions. Every investment and trading action carries risk, and readers are urged to execute their own thorough research before making any decisions.
Published At
12/5/2023 11:47:13 PM
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