Bitcoin tops $60,000 for first time in six months as traders bet on ETF approval

PUBLISHED: Fri, 15 Oct 2021 15:19:41 GMT
Ryan Browne
Reuters
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Key Points
  • Bitcoin surged as high as $59,920, notching its highest level since May. 10, but struggled to break above the $60,000 mark.
  • Traders are optimistic about the chances of the SEC giving the green light to the first bitcoin futures exchange-traded fund.
  • Approval of an ETF that gives mainstream investors exposure to bitcoin would be a landmark for the crypto industry.
In this article
    Art at the cryptocurrency conference Bitcoin 2021 Convention at the Mana Convention Center in Miami on June 4, 2021. Marco Bello | AFP | Getty Images

    Bitcoin climbed above $60,000 Friday, pushing the digital coin further toward its all-time high, as traders speculated U.S. regulators would clear the first bitcoin futures exchange-traded fund.

    The world’s biggest cryptocurrency surged as high as $60,314, notching its highest level since Apr. 18. Bitcoin was last trading 4% higher in the last 24 hours, at a price of $59,945, according to Coin Metrics data.

    Traders are optimistic about the chances of the U.S. Securities and Exchange Commission giving the green light to the first bitcoin futures exchange-traded fund, according to analysts.

    The ProShares Bitcoin Strategy ETF is scheduled to debut at the New York Stock Exchange on Tuesday, and experts believe the SEC unlikely to object to the product.

    The CME bitcoin futures contract for October was last trading at $60,570, up about 4%.

    Approval of an ETF that gives mainstream investors exposure to bitcoin would be a landmark for the crypto industry, which has long been pushing for greater acceptance of digital assets on Wall Street.

    “The ETF news is being priced in with the market expecting an approval on Monday. This is driving the price up,” Vijay Ayyar, head of Asia Pacific at cryptocurrency exchange Luno, told CNBC.

    Read more: Crypto trading thrives in Nigeria despite official disapproval

    However, Ayyar cautioned that a rejection of ProShares’ product could send bitcoin sharply lower.

    Mikkel Morch, executive director at digital asset hedge fund ARK36, said bitcoin could rally above its near-$65,000 all-time high from April, but warned the cryptocurrency may subsequently undergo a “short-term pullback.”

    “Investors should be aware that the hopes for a sustained rally above the $60K barrier and further through the previous all-time high may as well turn into ‘buy the rumour, sell the news’ scenario,” Morch said.

    Not all cryptocurrencies got a boost from the ETF news Friday. Ether, the second-largest coin, rose 0.5% to $3,804 on spot exchanges. However, XRP and ada were both down about 2%.

    Bitcoin and other cryptocurrencies have been on a wild ride this year. The number one digital coin hit an all-time high above $64,000 in April, before slumping sharply on the back of a crackdown on the crypto market in China. It’s since staged a comeback and has more than doubled in price so far this year.

    Regulators have been taking a tougher line on crypto this year, as interest from investors has surged. The industry has been putting up a fight though, with Coinbase on Thursday calling on the U.S. to create a new regulator to oversee digital assets.

    Earlier this week, Bank of England Deputy Governor Jon Cunliffe warned cryptocurrencies could spark a global financial crisis of similar magnitude to the 2008 crash.

    “When something in the financial system is growing very fast, and growing in largely unregulated space, financial stability authorities have to sit up and take notice,” Cunliffe said in a speech Wednesday.

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