Bitcoin, the largest cryptocurrency by market value, climbed to a two-month high of $28,817 on Wednesday, as investors anticipated the approval of a spot bitcoin exchange-traded fund (ETF) in the U.S.
The rally was fueled by amendments to the spot Bitcoin ETF filings by Fidelity, Ark Invest, and Invesco, which indicated ongoing communication with the U.S. Securities and Exchange Commission (SEC). The amendments addressed issues such as custody, disclosure, and regulatory risks.
Uptober and Speculation About Spot ETF Have Boosted Bitcoin’s Price
A spot Bitcoin ETF would allow investors to buy and sell Bitcoin directly through a regulated platform, without the need for intermediaries or derivatives. Many analysts believe that such a product would attract more institutional and retail demand for Bitcoin, boosting its price and adoption.
Some firms expect the approval of a spot Bitcoin ETF to add at least $1 trillion to the overall market capitalization of Bitcoin, which is currently at $1.1 trillion. Bitcoin’s dominance, the share of the total crypto market value, also rose to 48.5%, the highest level since July, as investors favored the original cryptocurrency over other tokens.
— James Seyffart (@JSeyff) October 17, 2023
Bitcoin outperformed major altcoins such as Ether, Cardano, and Solana, which posted modest gains or losses in the past 24 hours. Bitcoin’s bullish momentum could push it to test the $29,400 level in the near term, according to some analysts. BTC is currently trading at $28,423.38, according to COinMarketCap.
The cryptocurrency has been trading above its 200-day moving average since early October, signaling an uptrend. However, some caution is warranted as the SEC has not yet approved any spot Bitcoin ETFs and has repeatedly delayed or rejected previous proposals.
The regulator has expressed concerns about market manipulation, fraud, and investor protection in the crypto space. The SEC is expected to make a decision on several spot Bitcoin ETF applications by Nov. 14. Until then, investors should be prepared for high volatility and uncertainty in the crypto market.