Bitcoin BTC Price Holds Firm Above $30.1K As Investors Enjoy BlackRock, Other Spot BTC ETF Filings
Good morning. Here’s what happens:
Prices: Bitcoin rose above $30.7,000 before settling near $30,000 as investors enjoyed news of more spot bitcoin ETF filings.
Insight: Crypto has “gone through a crisis of confidence, but recent filings for spot bitcoin ETFs have helped energize the crypto markets,” says eToro US investment analyst Callie Cox.
Bitcoin returns to its perch above $30K
After weeks of gloom, bitcoin rose for a second straight day as investors drew confidence from spot BTC ETF applications from BlackRock and other major asset management firms.
The largest cryptocurrency by market capitalization recently traded at around $30,1[ads1]40, up nearly 5% in the past 24 hours. BTC last broke the $30,000 threshold in April.
Bitcoin started to rise on Tuesday after the long US June-July weekend as markets more fully digested the impact of the BlackRock filing. Later in the day, sentiment was further brightened by spot bitcoin filings from Invesco and WisdomTree, providing the latest evidence of institutional investors’ growing interest in the crypto space, even as markets have struggled amid an uncertain regulatory environment, nagging inflation and other macroeconomic issues. .
“There is a wave of optimism in the crypto market now that major institutional players are working to take part in the industry in a big way,” Nihar Neelakanti, CEO and co-founder of carbon-backed digital collectibles Ecosapiens, wrote in an email to CoinDesk.
Neelakanti also noted “rumors” that Fidelity may also apply for an ETF. On Tuesday, a Fidelity spokesperson told CoinDesk that the firm had not publicly announced any plans to file. Invesco, which has $1.4 trillion in assets under management, submitted its application in partnership with digital asset manager Galaxy Digital. The Securities and Exchange Commission (SEC) rejected WisdomTree’s first spot bitcoin ETF application in 2022.
“These players, among other big names, are obviously going to add a lot of liquidity to the market and make investors feel more confident about buying bitcoin again,” Neelakanti wrote. “And large institutions working with crypto are going to continue to be a catalyst for bitcoin for the foreseeable future, even if the US regulatory situation continues to cause some difficulties for the industry.”
Ether enjoyed a similarly upbeat Wednesday to continue its momentum. The second-largest crypto by market capitalization recently changed hands above $1,900 for the first time in three weeks, up more than 6% from Tuesday’s same time. Other major cryptos spent the day in deep green territory with ADA and MATIC, the native cryptos of smart contract platforms Cardano and Polygon, each up more than 7%, along with popular memecoin DOGE. The CoinDesk Market Index, a measure of the performance of the crypto markets, was recently up more than 5%.
US stocks swung from their weeks-long winning ways to tick lower with technology stocks leading the decline. The technology-heavy Nasdaq Composite and S&P 500 closed up 1.2% and 0.5% respectively. Asian markets opened on a sour note with the Hang Seng and Shanghai indexes recently falling by approx. 2% and 1.3%.
Ecosapiens’ Neelakanti believes TradFi will take advantage of “regulatory pressure on crypto” to unveil new digital asset initiatives, although he is uncertain about the long-term benefits of these partnerships. However, he added that each crypto “wave” has drawn new entrants.
“The last wave was a lot of retail speculators, and this fits with a pattern of how new asset classes develop over time,” he wrote. “You have early believers, then more retailers, and then the third wave of more institutions coming into the fold. We’re starting to see the beginning of the third wave now. And this wave will include the big institutions, but also 401Ks and other big types of funds such as pension funds and university grants.”
Crypto’s “Crisis of Confidence” and the Rush of Spot Bitcoin ETF Filing
Cryptos have been “going through a crisis of confidence,” but last week’s “rush of filings for spot bitcoin ETFs has returned “some excitement” to the markets, particularly to “well-known” quality coins like Bitcoin and Ethereum. Callie Cox, US investment analyst for social investment platform eToro , CoinDesk TV’s “First Mover” program told Wednesday.
“Institutional lenders, where this industry is growing, whether you like it or not, that’s the story for a lot of emerging markets,” Cox said. “And the fact that some of the biggest issuers in the world are stepping in and saying, ‘we want to offer this product,’ tells you something about pent-up demand, or demand from investors who might not be comfortable trading spot crypto. “
Last Thursday, the iShares unit of fund management giant BlackRock (BLK) filed paperwork with the US Securities and Exchange Commission (SEC) for the formation of a spot bitcoin (BTC) ETF. Earlier this week, investment management companies Invesco ( IVZ ) and WisdomTree reapplied for spot ETFs.
IVZ, which has $1.4 trillion under management, works in partnership with digital assets manager Galaxy Digital. It first applied for a spot bitcoin ETF in 2021. The Securities and Exchange Commission (SEC) rejected WisdomTree’s first application in 2022, amid a flurry of rejections.
The surge in institutional interest followed closely after ongoing US regulatory scrutiny appeared to reach new heights earlier this month with SEC lawsuits against exchanges Binance and Coinbase, leaving markets in a tailspin.
After rising sharply in the first four months of the year, bitcoin, ether and most other major assets have been on a downward spiral with BTC recently falling below $25,000 for the first time since mid-March as investors considered the SEC’s increasing scrutiny, inflation and other macroeconomic uncertainties. But even as the wider community overshadowed, institutional interest has continued to percolate.
Cox sees the ETFs as “a positive sign” and thinks the market is too. “It shows that Wall Street still believes in certain parts of crypto and that it’s not like the price of Bitcoin is going to zero. We need to understand what the value is. There is value.”
Bitcoin (BTC), the world’s largest cryptocurrency by market capitalization, has rallied over the past 24 hours after various traditional financial firms announced moves into the crypto market, indicating bullish sentiment. eToro US investment analyst Callie Cox shared her crypto market analysis. Additionally, Lindsey Grossman, the business manager at Bitkey, Block’s bitcoin wallet, joined “First Mover” to discuss partnerships with Coinbase and Cash App, along with the launch of Bitkey’s external beta registrations. And Axelar CEO and co-founder Sergey Gorbunov shared his reaction to the Uniswap Foundation’s recent bridge assessment report.
