Markets
Bitcoin rises to the $71,000 level today; What drives the rally?
Bitcoin (BTC) rose above $71,000 on Tuesday, hitting its highest level since early April, while Ether jumped more than 19% to $3,700. This surge followed Bloomberg analysts raising the likelihood of a spot ETH being approved in the US to 75%.
According to the latest data from SoSoValue, reported by The Economic Times, Bitcoin ETFs recorded total net inflows exceeding $241 million on May 20. Notably, BlackRock’s Bitcoin ETF, IBIT, attracted over $66 million in net inflows, while Fidelity’s Bitcoin ETF, FBTC, saw net inflows of $64 million.
Read also: SEBI Recommends Regulators Oversee Crypto Trading, RBI Still Sees ‘Macro Risk’
“The cryptocurrency market is surging as investors react to a torrent of good news. ETH rose 19% in 24 hours to surpass $3,700, while Bitcoin surpassed $71,000, up nearly 8%. The catalyst for this surge appears to be ETF approval, with rumors suggesting the SEC may be taking a step forward on this increasingly polarizing issue,” said Rajagopal Menon, VP, WazirX.
The global cryptocurrency market capitalization increased by 7.9% to approximately $2.61 trillion in the last 24 hours.
Other major cryptocurrencies also recorded significant gains: BNB (5.1%), Solana (3.5%), XRP (5.7%), Dogecoin (8.6%), Toncoin (5%), Shiba Inu ( 6.8%), Avalanche (14%) and Cardano (7.8%).
What drove the rally?
Markets began to recover late Monday after Bloomberg analysts Eric Balchunas and James Seyffart raised the probability of a spot ether ETF from about 20% to 75%. Subsequently, CoinDesk reported that the US Securities and Exchange Commission (SEC) has required that exchanges seeking to list Ether exchange-traded funds update their 19b-4 filings ahead of an important deadline this week.
This happened as the SEC asked would-be ether ETF exchanges to update their 19b-4 filings before the May 23 deadline. However, it is still unlikely that the ETH ETF will be approved just this week: the SEC seems to be moving in a positive direction, and that is what triggered the market.
Meanwhile, Ethereum, the second-largest cryptocurrency by value, rose 19.2% to reach $3,667 in today’s trading session.
Read also: All ready for the return of Binance and Kucoin to India
“The #Spot Ethereum ETF Approval Odds Increased from 25% to 75% as the #SEC Asks Exchanges to Update 19B-4 Filings on an Expedited Basis for Spot Ethereum ETFs. This is a huge news for the future of Ethereum, indicating that it may soon follow in the footsteps of #Bitcoin. Due to this, the market is witnessing significant movements and is expected to gain further momentum,” said Avinash Shekhar, Co-Founder and CEO of Pi42.
Over the past day, the market capitalization of Bitcoin, the leading cryptocurrency globally, rose to $1.402 trillion. According to CoinMarketCap, Bitcoin’s dominance is now 53.79%. Additionally, Bitcoin trading volume in the past 24 hours saw a significant increase, soaring 135% to reach $52.07 billion.
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Posted: May 21, 2024, 4.51pm IST
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