Ethereum has led the rally over the past day, with its price surging a staggering 18.6% to $3,645 at press time.

Bitcoin ($BTC ) surpassed the $70,000 mark on May 21, marking a major milestone as the rally was driven by heavy investments in spot bitcoin exchange-traded funds (ETFs) and broader market gains.

The price of Bitcoin climbed as high as $719,795, up 6% in 24 hours, before settling at $71,200 at press time, according to data from CryptoSlate.

This dramatic rise in $ETH can be attributed to speculation circulating in the market that the U.S. Securities and Exchange Commission (SEC) may approve an Ethereum spot ETF. This speculation sparked significant investor interest and buying, resulting in a significant 14.5% increase in ETH price in just one hour. This rapid rise not only demonstrates the market's positive response to potential financial product innovation, but also reflects the influence and market confidence of Ethereum as the second largest cryptocurrency.

As of press time, the price of ETH has climbed from $3,143 to $3,668.

Rekindled interest

After weeks of outflows, interest in Bitcoin ETFs has been rekindled, with nearly $1 billion flowing into these funds, providing investors with exposure to the leading digital asset.

The rally has led to significant liquidation in the market, with more than $235 million in positions being liquidated in the past 24 hours, according to CoinGlass data, including $63 million in Bitcoin short positions alone.

Analysts note that while some on-chain indicators show signs of a potential top, most point to the start of a bull run. The recent rally around $60,000 has sparked renewed interest, with Farside Investors reporting that around $950 million in inflows last week, a level not seen since March.

Bitcoin’s 51% year-to-date gain reflects investors’ expectations for monetary expansion in the U.S., as evidenced by the M2 monetary base exceeding $21 trillion in April 2024. The increase in money supply suggests that inflationary pressures are rising even as businesses and individuals are hesitant to spend.

Meanwhile, the Fed’s efforts to manage inflation and avoid a recession could affect liquidity and the appeal of assets like Bitcoin.

Scarcity

Bitcoin hit an all-time high of $73,737 in March and is now just 5% below that level. The recent rally appears to have been driven largely by new bitcoin ETFs, which trade on traditional stock exchanges and allow investors to buy shares that track the asset’s price.

Supporting the bullish sentiment, Bitcoin reserves on major exchanges have fallen to their lowest level in seven years. Data from CryptoQuant shows that as of May 19, there were only 1,918,417 BTC available on major trading platforms, a significant drop from the previous year.

This scarcity, coupled with the recent halving event which reduced potential new supply from miners, makes a bearish outlook on Bitcoin increasingly difficult to justify.

The crypto community continues to closely watch Bitcoin’s price action, with many wondering whether the digital asset will continue to climb higher or face a major correction in the coming weeks.

Conclusion:

With Bitcoin and Ethereum prices rising significantly, the market has once again proven its volatility and sensitivity to news. Bitcoin surpassed the $70,000 mark, while Ethereum surged on rumors that the US SEC may approve a spot ETF. These developments not only show the vitality of the cryptocurrency market, but also reflect investors' desire for new financial instruments and their enthusiasm for the market. Positive response to innovation.

The price fluctuations also highlight some key trends in the cryptocurrency market, including sensitivity to regulatory dynamics, the impact of asset scarcity on prices, and investors' expectations for market expansion and monetary policy. Despite the potential risk of market adjustments, the active participation of the crypto community and the transparent attitude towards governance lay the foundation for the long-term development and maturity of cryptocurrencies.

The future direction of the cryptocurrency market remains uncertain, but one thing is certain: this market will continue to attract the attention of global investors and may continue to serve as an attractive alternative investment channel outside of traditional financial markets. As the market continues to develop and mature, cryptocurrencies may become an increasingly important part of a diversified investment portfolio. #比特币 #以太坊ETF