A mock bitcoin in front of US dollars
(Picture: REUTERS)Bitcoin continues to climb higher and is now inches away from a new all-time high.
The world’s biggest cryptocurrency was up 2.7% at $62,479 at 8.20am in London on Monday. Bitcoin reached an all-time high of $64,863 in April.
Bitcoin has risen 50% in just the last three weeks. Much of the rally has had little obvious spur but the price has gained momentum in recent days from reports that a bitcoin ETF could be close to being approved.
Bloomberg reported on Friday that the US Securities and Exchange Commission (SEC) would drop its objection to an ETF. ProShares then filed an amended prospectus for its Bitcoin Strategy ETF stating that the fund was now slated to begin trading today, October 18, baring any last-minute intervention from the SEC.
“All eyes are on the US with at least one futures-based Bitcoin ETF expected to be given the go-ahead by the SEC today,” said Nicholas Cawley, an analyst at DailyFX.
Bitcoin supporters and financial firms spotting a market opportunity have long tried to get a bitcoin ETF off the ground but have faced opposition from regulators. The SEC has expressed concerns about volatility, potential manipulation, and the lack of regulation in the crypto space.
The SEC’s apparent about face comes even as the watchdog has toughened its rhetoric around crypto, calling for more power to regulate the space and taking action against companies like Coinbase.
ETFs are seen as a critical validation for crypto and a potential spur for prices, as ETFs will offer bitcoin exposure to a much wider pool of investors. Investors who currently want to buy bitcoin have to go through fintechs and unregulated exchanges, which may be off putting for some more risk averse investors. ETFs can be bought from well established brokers.
“A lot of good news has already been priced in, although with Bitcoin’s all-time high just $3k away a fresh attempt to break this is very likely to happen in the short term,” said Cawley.
Bitcoin’s rally comes in spite of wider weakness for the cryptocurrency sector. Ethereum was down 1% at $2,814, Cardano was 0.8% lower at $1.57 and XRP was down 3% to $0.80.
Bitcoin’s price growth was enough to offset weakness elsewhere: the market value of all cryptocurrencies in circulation was still up 0.9% in the last day to $2.5 trillion, according to data provider CoinMarketCap.com.
