Bitcoin's price surged beyond $36,000, reaching its highest level in 18 months due to market expectations for the approval of Bitcoin exchange-traded funds (ETFs) in the US exchange. On Thursday, during Asian trading hours, Bitcoin rose by 3.6% to $36,856, the highest since May 2022. Smaller cryptocurrencies like Ethereum and Solana also experienced gains.
Analysts from Bloomberg Intelligence, James Seyffart and Eric Balchunas, noted an eight-day window for the US Securities and Exchange Commission to theoretically issue approval. Even if the ETF approval doesn't happen this month, they remain optimistic, estimating a 90% chance of approval by January 10, 2024.
The optimism surrounding potential ETF approval, after over a decade of consideration, has propelled the crypto market to a 120% gain this year. Caroline Mauron, co-founder of digital asset liquidity provider Orbit Markets, anticipates sustained interest in betting on Bitcoin's rally.
Josh Gilbert, a market analyst at eToro, sees ETF expectations as a top catalyst, further boosting the current rally. Alongside the ETF trigger, Gilbert mentions speculation that the US Federal Reserve has completed interest rate hikes for now, and Bitcoin's upcoming halving next year also triggers the crypto rally.
Additionally, Fyqieh Fachrur, a trader at Tokocrypt, attributes current Bitcoin price support to consistent accumulation by long-term investors. Glassnode data confirms a continuous increase in Bitcoin holdings by long-term investors in recent months, emphasizing the scarcity of Bitcoin supply.
Fyqieh highlights the dovish tone from some Fed officials as another supporting factor. A dovish stance, favoring accommodative monetary policies to stimulate economic growth, typically positively impacts risk assets like stocks and crypto, diminishing the appeal of safer assets like bonds.
