Bitcoin‘s price surged to $35,000 on Tuesday, marking a year-to-date rally of 107% and a monthly increase of 28%. The peak is the highest since May 2022, driven by anticipation of spot Exchange-Traded Fund (ETF) approval. The surge led to bearish crypto traders suffering losses of approximately $178 million within one day, according to a CoinDesk report.
The cryptocurrency later stabilized around $34,200 after an 11.5% surge on Tuesday. Bitcoin’s value slightly fell to around $34,440 by midday in New York. Data from CoinGlass indicated that Monday saw $400 million in crypto liquidations, with Bitcoin futures contributing half. Major crypto exchanges Binance, Huobi, and OKX each had $50 million in liquidations.
Spot bitcoin ETF applications by financial giants BlackRock (NYSE:BLK), Fidelity, and VanEck to the Securities and Exchange Commission (SEC) have buoyed the optimism in the crypto market. Grayscale Investment’s legal victory against the SEC‘s effort to block its bitcoin trust conversion into a spot bitcoin ETF further fueled this optimism. The listing of “iShares Bitcoin Trust” on the Depository Trust and Clearing Corporation website indicates impending ETF trading.
A spot ETF would create a tradeable item tied to Bitcoin’s current price, allowing more investors to participate without owning Bitcoin directly. Despite concerns about Bitcoin’s volatility and potential market manipulation, the SEC has shown restraint in its response.
Analysts are predicting that SEC approval could push bitcoin prices to a staggering $180,000 before the cryptocurrency’s scheduled halving in April 2024. The SEC’s decision not to appeal against Grayscale’s court ruling further supports this optimism.
Crypto advocate billionaire Mike Novogratz predicts spot ETF approval this year, which could significantly benefit Coinbase (NASDAQ:COIN) Global. The company reported a Q2 revenue of $707.9 million, and the ETF approval could boost its performance further.
Riot Platforms and Marathon Digital (NASDAQ:MARA) Holdings, each with a market cap of $2.17 billion, have outperformed Bitcoin this year. Riot has diversified its operations across Bitcoin Mining, Data Center Hosting, and Engineering, using a unique Power and Demand Response Credits strategy for a 5.2% YoY growth with $76.7 million in revenue in Q2 2023.
Despite the Federal Reserve’s interest rate hikes suppressing prices, the Bitcoin ETF hype continues to fuel the market.
