After the successful launch of the first U.S.-based exchange-traded fund, Bitcoin rocketed to a new high, crossing the $66,000 mark for the first time.
In contrast to the traditionally volatile digital currency, which has spent recent days lingering around a narrow range as it approached its previous April high, the aforementioned vault happened significantly faster: the price added nearly $1,000 in a minute just after the opening of the United States Stock Exchange. In the little more than a decade of cryptocurrency trading, big changes have often been linked to important chart milestones.
Jesse Proudman, co-founder and CEO of crypto consultancy firm Makara, called it a “validating moment.” This is a significant turning point in the broader digital-asset class’ history, because the question of whether this asset class will continue to exist is no longer relevant.
Bitcoin has reached a new high on the back of a flood of liquidity from the epidemic era, speculative bets, and anticipation of institutional adoption. The ride was bumpy: in June, the token fell below $30,000 because to criticism of its energy use and China’s crackdown on cryptocurrencies. In response to China’s counter-offensives, the crypto sector saw some recovery.
In the midst of all the price mania, many on Wall Street harbor grave doubts about Bitcoin’s place in finance. The U.S. government has effectively blocked a Bitcoin loan program at Coinbase Global Inc. as a result of increased scrutiny from securities regulators. Others have questioned whether the asset’s scarcity makes it a good long-term investment, and they have pointed out that it has taken a long time for it to catch on as a trading currency.
As of 10:45 a.m. in New York, Bitcoin was up 4.1% to $66,722, increasing its year-to-date gain to about 130%. After falling by 73% the previous year, the most popular digital currency saw gains of almost 300 percent in 2018 and a further 95 percent in 2019.
The first U.S.-listed Bitcoin ETF debuted on Tuesday, becoming the second-heaviest traded fund ever in the crypto industry’s history.
According to Bloomberg’s calculations, about 24 million shares of the ProShares Bitcoin Strategy ETF (ticker: BITO) were traded on Tuesday.
When it comes to the first day of trading, the BITO Carbon Fund came in second only to a BlackRock Carbon Fund due to pre-seed investments made by the latter, according to Bloomberg Intelligence.
Prices have risen to these heights because of the upcoming introduction of a Bitcoin futures ETF in the US, according to Valkyrie Investments’ CEO Leah Wald, who is also the company’s top executive. Market participants believe this is a forerunner to the “holy grail” of Bitcoin exchange-traded funds (ETFs), and their excitement is pouring into the largest cryptocurrency at a breakneck rate.
Some of Bitcoin’s most ardent supporters support questionable claims that the virtual currency is a wealth-accumulating vehicle and a hedge against the most serious inflation threat in many years.
A growing number of Wall Street firms, including Bank of New York Mellon, Goldman Sachs, and Morgan Stanley, are providing services connected to cryptocurrencies. It’s safe to say that crypto has “gone mainstream,” according to Soros Fund Management LLC Chief Investment Officer Dawn Fitzpatrick.
There is still much to be done, however. Even if roughly 10% of financial-services businesses have a “feeding frenzy” in crypto, the great majority are wary of the asset class, according to SkyBridge Capital founder Anthony Scaramucci.
A new crypto-economy has emerged in the last few years. With the rise of non-fungible tokens (NFTs), owners of digital art and collectibles can now trace who owns what.
As has the DeFi ecosystem, which eliminates the need for middlemen like banks and allows users to lend, borrow, trade, and buy insurance directly from one another.
As if on cue, Satoshi Nakamoto, a person who went by the pseudonym Satoshi Nakamoto, published a research paper on Halloween 2008 announcing the creation of Bitcoin.
“Bitcoin: A Peer-to-Peer Electronic Cash System” was the title of the paper. Its launch sparked a digital currency revolution that resulted in the creation of over 12,000 more coins, according to data from CoinMarketCap.com. More than $2.5 trillion worth of cryptocurrencies are currently traded on the world’s exchanges.