The cryptocurrency market experienced significant growth on Monday, with Bitcoin leading the way and outperforming traditional stocks. This surge is fueled by the increasing anticipation of regulatory approval for Bitcoin exchange-traded funds (ETFs). Technical indicators also suggest a positive outlook for the crypto giant.
In the past 24 hours, Bitcoin’s price has risen by 2%, surpassing $30,450 and even reaching close to $31,000 at one point. This comes after a period of sideways movement around the $26,000 range. Over the past ten days, Bitcoin has experienced a significant rally, reaching levels not seen since mid-July.
Alex Kuptsikevich, a seasoned analyst at FxPro, commented on this recent trend, stating, “The past week has been exceptional for Bitcoin, with a 10% growth. If we can maintain stability above $31,000, we might witness a rapid rise to the $40,000 range.”
While traditional markets such as the Dow Jones Industrial Average and the S&P 500 face challenges due to rising government bond yields, cryptocurrencies remain strong. Typically, higher yields on US Treasuries can dampen enthusiasm for riskier assets. However, Bitcoin has defied this logic, driven mainly by optimism surrounding the potential approval of a Bitcoin ETF by the Securities and Exchange Commission (SEC).
The buzz around a Bitcoin ETF has been growing, especially after financial giants like BlackRock showed interest. The recent legal victory for crypto asset manager Grayscale regarding the conversion of its Bitcoin trust to an ETF further fuels this anticipation. Such an ETF would directly hold Bitcoin, setting it apart from funds that hold Bitcoin futures. This could attract a fresh influx of both retail and institutional investors, boosting cryptocurrency prices.
However, while the technical landscape appears favorable, the actual launch of an ETF could still be months away. Additionally, the ongoing decline in stocks may potentially impact the crypto market. Kuptsikevich emphasized that “a strong risk-averse sentiment might lead to institutional selling in the crypto space.”
Other cryptocurrencies also experienced growth. Ether, the second-largest cryptocurrency, saw a 2% increase, reaching $1,670. Altcoins like Cardano and Polygon also saw gains of 2% and 8% respectively. Memecoins like Dogecoin and Shiba Inu also recorded gains of 4% and 2% respectively.