For the first time since May 2022, bitcoin is above $40,000 as traders speculate on the upcoming approval of U.S. stock market-traded bitcoin ETFs and as the cryptocurrency rides a wave of enthusiasm surrounding U.S. interest rate cuts.
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The largest cryptocurrency in the world reached its highest level since April 2022 on Monday, hitting $41,748. This appeared to shake off the negativity that had enveloped the cryptocurrency markets after FTX’s collapse and other cryptocurrency-related business failures earlier in the year.
Bitcoin Surpasses Record High Since April 2022
At $41,627, it was up 4% as of late. After a 50% increase since mid-October, the market has “seemed to mark a decisive shift away from the bearishness of 2022 and early 2023,” according to Justin d’Anethan, head of business development for Asia-Pacific at Keyrock, a company that creates digital assets.
While future reversals were not unlikely, D’Anethen stated that lows of approximately $16,000 a year ago “probably marked the bottom” and that signs of institutional buying through November, demonstrated a new leg of interest.
So far this year, Bitcoin has increased by more than 150%.Investor in bitcoin Microstrategy (MSTR.O) said last week that it added $593 million to its holdings during November.
In the meantime, riskier assets and other assets that are sensitive to interest rates, like gold, have also seen significant price increases in recent weeks as investors bet that the US Federal Reserve has completed raising interest rates and would begin reducing them early in 2024.
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Bets that an eventual approval is close have also increased in response to reports in October that the U.S. Securities and Exchange Commission will not appeal a court decision finding the agency was incorrect in rejecting an exchange-traded fund application.A spot bitcoin ETF could allow previously wary investors access to crypto via the stock market, ushering a new wave of capital into the sector.
Investors have also applauded the resolution of a lengthy criminal investigation by the United States into Binance, the biggest cryptocurrency exchange in the world and a vital component of the global cryptocurrency market. The agreement permits Binance to carry on with business as usual. Changpeng Zhao, the creator of the company, stepped down following his guilty plea to violating US anti-money laundering rules.
Ether, the currency associated with the Ethereum blockchain, also reached $2,264 on Monday, a 1-1/2 year high.
Both ether and bitcoin are still well behind their record highs of $4,868 and $69,000, respectively, set in 2021.
– Reports from Reuters