Bitcoin’s value has climbed today, surpassing $28,700 and reaching a two-month high with a noticeable upward spike. This surge is attributed to Bitcoin maintaining the critical $28,000 level, supported by institutional adjustments to various spot Bitcoin ETF applications and retail investors’ optimism regarding the upcoming Bitcoin supply halving.
Despite facing broader economic challenges, the recent surge in spot Bitcoin ETF adjustments in mid-October played a significant role in sustaining BTC prices above $28,000, fostering positive market sentiment.
Following U.S. Court of Appeals Circuit Judge Neomi Rao’s decision in favor of Grayscale Investments against the U.S. Securities and Exchange Commission on Aug. 29, numerous major institutions applied for ETFs. Another victory for Grayscale occurred on Oct. 14 when the SEC announced it wouldn’t contest this decision, potentially prompting Grayscale to file for a new spot Bitcoin ETF on Oct. 19.
Despite multiple applications, the SEC has yet to approve a spot Bitcoin ETF, even with submissions from major entities like BlackRock, Fidelity, ARK by Cathie Wood, and 21Shares, which has made three approval attempts.
The upcoming Bitcoin halving, projected for April 2024, sparks ongoing discussions among analysts about its potential bullish impact on BTC prices this time. Capriole Investments notes:
“Through Bitcoin’s 14 years of cyclical history, all of its returns and more were accounted for in the 12–18 month period following each Halving. Investing in the 4-6 months prior to each Halving saw even greater 12 month performance in 2020.”
A Bitcoin ETF approval might alleviate liquidity concerns, generating an estimated $600 billion in new demand. Similar to gold’s response after a gold ETF approval, which resulted in a 350% return, Capriole Investments suggests a parallel effect for Bitcoin.
Coinciding with Bitcoin’s price surge, the BTC supply on exchanges remains below the Sept. 4 monthly peak, with over 70,000 BTC withdrawn since then. The departure of coins from exchanges is perceived as a bullish signal, especially as long-term Bitcoin holders reach 76% of all BTC ownership for the first time on Oct. 19.
With Bitcoin leaving exchanges and recent liquidations impacting prices, the cryptocurrency market sentiment is gradually shifting from fear to neutrality, as indicated by the Bitcoin Fear & Greed Index gaining seven points in a week