Bitcoin surges to three-month high amid ETF enthusiasm

WEB DESK: The world’s largest cryptocurrency Bitcoin experienced a substantial surge on Monday, reaching a three-month high with a 4.73 per cent increase, bringing its price to $31,420.

According to international media, the surge was fueled by growing investor optimism regarding the potential launch of a spot Bitcoin exchange-traded fund (ETF).

As a result of Bitcoin’s rise, shares of companies related to cryptocurrencies and blockchain, including Coinbase Global (COIN.O) and Marathon Digital Holdings (MARA.O), experienced significant gains of 6.5 per cent and 11.9 per cent, respectively. Bitcoin has shown resilience and is up more than 18 per cent from its low for the year, which was recorded at $26,533 on October 11.

Simultaneously, concerns are rippling through broader financial markets due to the risk of the ongoing conflict between Israel and the Islamist group Hamas escalating into a wider regional conflict. This geopolitical tension has prompted investors to seek out scarce assets, with Bitcoin often being seen as a digital equivalent to gold in times of uncertainty.

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Zach Pandl, the Managing Director of Research at Grayscale Investments, a crypto asset management firm, commented on this trend, saying, “We have seen recent geopolitical tensions drive demand for scarce assets, including both physical gold and Bitcoin.”

The yield on 10-year US Treasuries also reached a high of 5.021 per cent on Monday, reflecting the continued sell-off in government bond markets.

Bitcoin’s price briefly soared on October 16 following an erroneous news report about asset manager BlackRock’s application for a spot Bitcoin ETF, designed to track the cryptocurrency’s underlying price. The US Securities and Exchange Commission is currently reviewing the proposal and is expected to make a decision no later than next year.

Matteo Greco, a research analyst at Fineqia, an investor focusing on crypto and fintech, noted, “Over the past month, the growing investor confidence in the imminent approval of BTC spot ETFs has driven considerable momentum toward BTC.”

Meanwhile, Ethereum’s cryptocurrency, Ether, which is linked to the Ethereum blockchain network, saw a 2.79 per cent rise, reaching $1,710.6 on Monday.

Hum News