Bitcoin has made a surprise resurgence with the price surpassing over $40,000 for the first time since May 2022 despite expectations of interest-rate reductions and increased demand from exchange-traded funds. In the early hours of Monday morning, Bitcoin added about 1% to trade at $40,005 on Monday in Singapore, taking its 2023 jump to 142%. Before the TerraUSD stablecoin collapse, it was at $40,000 previously due to a rout in digital assets.
In addition the cryptocurrency market is expecting Blackrock Inc.’s application to launch the first exchange-traded fund in the US which is awaiting the approval of Securities and Exchange Commission. The approval is expected to be granted to a batch of such funds by January as reported by Bloomberg Intelligence.
“Bitcoin continues to be supported by optimism around SEC approval for an ETF and Fed rate cuts in 2024,” Tony Sycamore, a market analyst at IG Australia Pty, wrote in a note. Technical chart patterns point to $42,330 as the next level to watch for, he added, as quoted by Bloomberg.
The US has cracked down on Bitcoin and cryptocurrency in general after the 2022 Crypto crash which included the arrest of Sam Bankman-Fried for fraud at FTX and fined Binance and its founder Changpeng Zhao.
Industry optimists, however, view these regulatory actions and the flurry of ETF applications as signs of a maturing market and potential expansion of the investor base for digital assets. While uncertainties such as rate adjustments or complications with ETF approvals loom, the current market sentiment remains buoyant. Adding to this sentiment is the anticipation of the upcoming Bitcoin halving event next year.
Although Bitcoin and other tokens like Ethereum and BNB remain below their pandemic-era peak values, with Bitcoin’s highest at almost $69,000 in November 2021, the current trends indicate a rejuvenated interest and potential for growth in the cryptocurrency sector.
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