Cryptocurrency prices rose broadly on Monday, with bitcoin climbing above $27,000 for the first time this month. The surge in trading volume occurred after Japan’s Nikkei reported over the weekend that the Japanese government intends to permit startups to offer digital tokens to venture capital funds, alongside traditional assets such as stocks and stock options, as quoted on CNBC.
Despite the prevailing bearish technical indicators, Bitcoin is experiencing its first consecutive weeks of gains since May. While cryptocurrency traders typically remain unperturbed by short-term fluctuations, this trend has raised concerns among some that it could signal a potential break in long-term momentum.
Let’s delve a into the positive developments in the crypto space.
Landmark Legal Victory for Bitcoin ETFs
One of the most significant developments in 2023 for the Bitcoin ecosystem was the legal victory in the U.S. Court of Appeals for the D.C. Circuit, involving Grayscale and the U.S. Securities and Exchange Commission (SEC).
The court sided with Grayscale in its lawsuit against the SEC’s denial of the company’s application to convert the Grayscale Bitcoin Trust into an ETF. This decision is not only a win for Grayscale but also sets an example that could impact other companies seeking to launch Bitcoin ETFs, including industry giants like BlackRock and Fidelity.
Before this in July, Coinbase’s arguments in its legal case against the SEC were strengthened after a key court ruling went partially in favor of cryptocurrency firm Ripple.
Blackrock, WisdomTree and Invesco Plan to Launch Bitcoin ETFs
In past few weeks, we have seen the filing of spot ETF applications by renowned asset managers, which fueled a growing interest in cryptocurrencies from institutional and corporate clients. While the SEC has been in denial for a Bitcoin ETF for long, the filings represent a significant step towards widespread adoption. The world’s largest asset manager BlackRock’s plans to launch a bitcoin ETF in June influenced the entire space. Two other large investment firms now joined the queue, WisdomTree and Invesco.
Increased Adoption
Robinhood Markets has added wallet support for Bitcoin (BTC) and Dogecoin (DOGE). So far, the multi-chain, self-custody and Web3 wallet was restricted to sending and receiving tokens built on the Ethereum (ETH) blockchain only.
Institutions such as JPMorgan and Goldman Sachs, which were against virtual currencies before, have started implementing them into their systems. This is a sign of growing acceptance among institutional investors.
What Lies Ahead?
There are high chances that the Fed might hike rates in November if the inflation creeps higher. If the Fed hikes rates, the risk-on sentiments may get hurt and cryptocurrencies may decline.
Any Sliver Linning?
Halving events, which occur about every four years, lower the mining rewards by half. The resulting shortage of newly mined BTC has historically played a crucial role in driving price rallies. As the having event looms in 2024, traders are tightening their belts for a new cycle. So, there is high chance of an upward momentum for Bitcoin.
Though the SEC’s stance toward cryptocurrency has been adverse so far, back-to-back efforts in launching an ETF from reported issuers stirred speculation that such intuitional initiatives might compel legislative institutions to figure out how to classify and regulate them.
ETFs in Focus
Against this backdrop, following are the regular ETFs on this concept that may win in the near term. Hence, investors can keep a tab on the likes of VanEck Digital Transformation ETF DAPP, Global X Blockchain ETF BKCH, Valkyrie Bitcoin Miners ETF WGMI, First Trust SkyBridge Crypto Industry & Digital Economy ETF CRPT and Fidelity Crypto Industry and Digital Payments ETF FDIG.
Global X Blockchain ETF (BKCH): ETF Research Reports
VanEck Digital Transformation ETF (DAPP): ETF Research Reports
First Trust SkyBridge Crypto Industry and Digital Economy ETF (CRPT): ETF Research Reports
Valkyrie Bitcoin Miners ETF (WGMI): ETF Research Reports
Fidelity Crypto Industry and Digital Payments ETF (FDIG): ETF Research Reports
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