Bitcoin ETF Approval Sets Stage for Crypto Price Rally

Image source: Coinpedia

Riding the wave, Bitcoin ETF approval by the giant Wall Street Blackrock propels the crypto market to new heights, signalling a bull run ahead.

On Jan. 10, 2024, the United States Securities and Exchange Commission (SEC) announced the approval of the listing and trading of spot bitcoin exchange-traded fund (ETP) shares. The first Bitcoin tracking Exchange Traded Funds (ETF) to be listed in the United States. This landmark decision has sparked expectations for a future highly volatile cryptocurrency market and represents a critical turning point in the public adoption of cryptocurrencies, notably Bitcoin. Besides the expected spike in Bitcoin’s price following this approval, it also stamps the cryptocurrency’s dominance and asset maturity. 

Gary Gensler, the SEC chairman, stated that “Investors today can already buy and sell or otherwise gain exposure to bitcoin at a number of brokerage houses, through mutual funds, on national securities exchanges, through peer-to-peer payment apps, on non-compliant crypto trading platforms, and, of course, through the Grayscale Bitcoin Trust. Today’s action will include certain protections for investors.”

Also read: From Traditional Assets to Crypto.

With this approval, crypto investors will have more ways to purchase Bitcoin through established brokerage firms, giving them a safe, regulated way to do so. It also shows that institutional investors are beginning to adopt cryptocurrency more and more. Investors and cryptocurrency fans are excited about the approval of the spot ETF, and many believe it will lead to a market boom. In reaction to the news, Bitcoin—which has experienced considerable volatility in recent months—rose sharply, breaking through important resistance levels and setting new records.

Image Sorce: TradingView

On Jan. 10, 2024, the price of Bitcoin closed at $46,627.78 after the approval of the Bitcoin ETF. As of Feb. 21, 2024, the price has closed at $51,801.35, representing a 10% price rally a few weeks after the SEC announcement. 

How will the Bitcoin ETF approval affect BTC prices?

The Bitcoin ETF’s approval can significantly impact its future price by increasing market liquidity, attracting institutional investment, fostering arbitrage opportunities, improving market sentiment, and opening up access for traditional investors. Along with welcoming new investors, this regulatory approval indicates that traditional finance is beginning to recognize Bitcoin, which could lead to higher prices due to stability and rising demand.

Market players are keeping a careful eye on the price fluctuations of Bitcoin and other cryptocurrencies in light of this event, expecting a possible spike in demand. A significant milestone in the development of the cryptocurrency market and its assimilation into the established financial system has been reached with the approval of the spot ETF.

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