Bitcoin has reached $45,000 for the first time since April 2022 as potential ETF approval looms.
Bitcoin, the largest cryptocurrency by market cap, has had a strong start to 2024, pushing past $45,000 in the early hours of January 2.
The price reflects a 5.8% 24-hour increase, and a 14.6% increase over the past 30 days, per CoinGecko data.
The last time Bitcoin traded above $45,000 was in April 2022, before it slowly descended down to $15,600 throughout the bear market.
The surge is driven by anticipation that the US Securities and Exchange Commission (SEC) will batch approve the first spot Bitcoin ETFs this week.
Senior Bloomberg analysts such as Eric Balchunas and James Seyffart have frequently expressed confidence that approvals will come in the first week of January, though this is still speculative.
Other prominent analysts however, such as Nate Geraci, President of ETFStore and host of the ETF Prime podcast, expressed concern that the frenzy could be one of the “bigger rug pulls in crypto history” if rejected.
The price of Bitcoin has surged by 80% since BlackRock, the world’s largest asset manager, filed for a spot Bitcoin ETF on June 15.
If Bitcoin ETFs are approved in January, the market could see inflows of $1 billion in the first few days and $2.4 billion within the first three months, according to VanEck analyst, Patrick Bush.
Historically, the SEC has rejected all spot crypto ETF applications, including applications from Ark Invest, Winklevoss and VanEck. Key reasons include concerns of market manipulation, lack of surveillance, and a general lack of regulatory oversight.
Many however believe that BlackRock’s entrance to the market will break the cycle of rejections, since its ETF approval rate is 99.8%.
This optimism is fuelled further by recent amendments to BlackRock’s application, such as cash redemptions, which align more closely with traditional ETF structures and enable Wall Street banks to participate.
Read more: BlackRock amends ETF structure to make it easier for Wall Street banks to participate in fund
Additionally, in his appearance on CNBC’s Money Movers, SEC Chair Gary Gensler hinted at a potential shift in the SEC’s approach, commenting that the Commission is “taking a new look” at the applications based on Grayscale’s recent legal victory.
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