On Tuesday, Bitcoin surpassed $45,000 for the first time since April 2022. BTC is off to a strong start to 2024 with hopes of introducing an exchange-traded spot Bitcoin fund.
At $45,355, the world’s largest and best-known cryptocurrency rose 4.3%, reaching its highest level since April 6, 2022. Other tokens also showed gains. Ethereum, the second largest, rose 2.6%.
These changes still leave Bitcoin 34% off its November 2021 high of $69,000.
Expectations for Bitcoin ETF Approval Fuel Rally
The U.S. Securities and Exchange Commission is expected to approve the launch of numerous spot Bitcoin ETFs, as it has done for several weeks, which appears to be driving the price rally.
“There are rumors going around that a spot Bitcoin ETF will be approved this week,” said cryptocurrency YouTuber Lark Davis. Get ready.”
Rumors are swirling that a spot Bitcoin ETF will be approved this week. get ready
— Lark Davis (@TheCryptoLark) January 2, 2024
On Friday, the SEC received updated filings from applicants, including joint ventures Ark Invest/21shares, Blackrock, Bitwise, Fidelity, Vaneck, Valkyrie, Invesco and Wisdomtree.
The first due date for the spot Bitcoin ETF planned by Ark Invest/21shares is January 10th. By then, many expect securities authorities to approve several spot Bitcoin ETFs.
Regulators may begin notifying ETF sponsors on Tuesday that their applications will be approved, according to a Reuters report published over the weekend.
BTCUSD trading at $45,275 on the weekly chart: TradingView.com
In recent years, the SEC has rejected numerous requests to introduce a spot Bitcoin exchange-traded fund (ETF), citing the cryptocurrency market’s vulnerability to manipulation.
Spot Bitcoin ETF Approval Drives Investor FOMO
Ahead of the impending approval, investors have been “buying in on January 1st first thing in the morning on the new year,” according to Hayden Hughes, co-founder of social trading platform Alpha Impact. This has left some traders in the US and Europe fearful of losses.
BTCUSD 24-hour price action. Source: Coingecko
According to Jupiter Zheng, liquid capital partner at HashKey Capital, the cryptocurrency market will see significant growth this year. Key drivers of this growth will be investment capital inflows through spot ETFs, BTC halving, and more accommodative monetary policies globally and in the United States.
Meanwhile, options traders were riding the excitement of spot ETFs and betting on the top cryptocurrency hitting $50,000.
According to Cici Lu McCalman, founder of blockchain advisory Venn Link Partners, a significant adjustment seems unlikely given the general optimistic mood and the impending halving (a process that halves the amount of Bitcoin miners receive as block rewards).
“I think traders will need courage of steel to sell BTC,” she said.
If this trend continues in 2024, trader and analyst “Nebraskangooner” predicted a price of $48,000 for the next surge.
Unfortunately, this could happen today
Then $48,000 area goal. pic.twitter.com/fDgVaCkTDA
— Nebraska Kangooner (@Nebraskangooner) January 1, 2024
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