Bitcoin has surpassed the $45,000 mark for the first time in almost two years, marking a significant milestone as anticipation grows around the potential approval of the first spot Bitcoin exchange-traded fund (ETF) in the United States.
The leading cryptocurrency experienced a rapid climb from $42,000 on January 1, registering a more than 6% surge in the last 24 hours and an impressive 170% increase over the past year. Bitcoin’s current price level exceeds any reached in 2023, setting a notable high just two days into 2024.
This surge in Bitcoin’s price coincides with the market’s anticipation of a decision from the U.S. Securities and Exchange Commission (SEC) on the pending applications for spot Bitcoin ETFs. There are currently 14 outstanding applications awaiting approval or rejection by the regulator.
The last time Bitcoin traded above $45,000 was almost 20 months ago on April 5, 2022, before descending into a prolonged bear market that saw Bitcoin’s value plummet to as low as $15,600, according to TradingView data.
Market analysts hold divergent views on how the potential approval of a Bitcoin ETF will impact its price in the short term. Some, like analysts from the crypto options trading platform Greeks.live, predict a lack of a significant rally on the approval day due to decreasing implied volatility on Bitcoin options.
However, there are contrasting opinions. Scott Melkor, a prominent voice on social media platform X, suggests that Bitcoin is forming a “bull pennant” after a month of consolidation around the $40,000 mark. Melkor speculates that Bitcoin could surge as high as $54,000 in the days following a potential SEC approval.
In contrast, Gabor Gurbacs, an advisor at VanEck, anticipates that the early days of a spot Bitcoin ETF might be viewed as a “letdown” by broader market standards. Nonetheless, he believes that these products will eventually attract trillions of dollars in inflows over the next few years. As the market awaits the SEC’s decision, the crypto community is bracing for potential shifts and volatility in Bitcoin’s price dynamics.
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