ISLAMABAD: Bitcoin surged to a two-year peak above $57,000 during Asian trading on Tuesday, fueled by indications of substantial institutional investment, while its counterpart, ether, breached the $3,200 mark for the first time in two years.
As the Gaza war has slowed down global economic activities, financial institutions are buying Bitcoin and other leading cryptocurrencies. This is one of the key factors behind resurgence of the Bitcoin in the global trading in recent weeks.
Over the span of two sessions, Bitcoin has experienced a surge of over 10%, partly attributed to an announcement on Monday by MicroStrategy (MSTR.O), a crypto investor and software company, revealing its recent acquisition of approximately 3,000 bitcoins, valued at $155 million.
The primary cryptocurrency, renowned for its market capitalization, has further received a boost from the green light given to bitcoin-centric exchange-traded funds (ETFs) in the United States.
This approval on Monday led to a notable surge in trading volumes for several ETFs and rallied crypto-associated companies, in contrast to the jittery performance of broader markets.
Earlier, for the first time, The US Securities and Exchange Commission (SEC) gave approval for spot Bitcoin exchange-traded funds (ETFs), a landmark moment for the industry that paves the way for new investors to get exposure to crypto.
The decision will enable investors to access bitcoin through conventional brokerage accounts, rather than crypto-native startups that face growing regulatory pressure after numerous scandals and bankruptcies.
“Today, the commission approved the listing and trading of a number of spot bitcoin exchange-traded product (ETP) shares,” said SEC Chair Gary Gensler in a statement.
The head of digital asset management at Fidelity, one of the bitcoin ETF issuers said that these ETFs would be an efficient way for investors to gain exposure to Bitcoin.
Bitcoin briefly jumped past $47,000 following the approvals, before paring most of its gains to trade around $46,084.
The largest cryptocurrency, which plummeted 64% in 2022, has surged around 2.8x in 2023 as investors anticipated the SEC’s approval of Bitcoin-spot ETFs.
Although the SEC approved the ETFs, Gary Gensler said that it did not approve or endorse bitcoin.
“Investors should remain cautious about the myriad risks associated with bitcoin and products whose value is tied to crypto,” he added.
The SEC of the United States okayed a total of 11 spot bitcoin ETFs, offered by BlockRock, Grayscale, Valkyrie, Hashdex, Bitwise, BZX, Invesco, VanEck, WisdomTree, Fidelity, and Franklin.
