A fleeting 10% jump in Bitcoin (BTC-USD) value gave traders a peek at what it may be like when exchange-traded funds (ETFs) invest directly in cryptocurrency. This matter is currently sitting on the desk of the US Securities and Exchange Commission (SEC) awaiting approval or rejection.
Bitcoin’s 10% jump sheds light on ETF investments in cryptocurrency
The sudden increase came in response to an incorrect report, which rumoured that BlackRock Inc. got the go-ahead to launch a spot cryptocurrency ETF. This catapulted Bitcoin to a value of $30,002 on Monday, the highest it has been since August.
Things simmered down after BlackRock said the relevant application is still under review with the US financial watchdog. Bitcoin closed Monday’s trading at $28,540.67, 4.4% up from the previous close.
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In anticipation that the SEC will desist its opposition to cryptocurrency trading, other financial firms also applied to offer US spot Bitcoin ETFs. Those on the side of digital assets and currencies are positive that the launch of these funds will boost wider acceptance and use. A Bloomberg Intelligence ETF analyst, James Seyffart, offered the following:
This was like a dry run for what’s going to happen if these things actually do get approved. It basically gave traders a playbook.
In the Bloomberg Television interview, Seyffart indicated that he expects several spot Bitcoin ETFs to be approved around January. However, many are still trying to get the bad cryptocurrency taste out of their mouths after the FTX debacle and the ongoing Sam Bankman-Fried trial. The latter is currently in court, facing charges of multi-billion dollar corruption.
