Bitcoin hits new yearly high as institutional interest grows
Bitcoin recently broke its $30,000 resistance level by rallying past $31,000 on the eToro platform. This marks its highest price level since May 2022, marking an unprecedented trend despite the recent crypto crackdown, sparking a renewed growing interest among investors.
The current price of Bitcoin has since corrected slightly, hovering at around $30,687. Over $15 billion of the asset is currently being traded, showing an increase of just above 11 percent in the last 24 hours, according to CoinMarketCap.
Bitcoin still holds the top rank on the site, with a live market capitalization of $596 billion at the time of writing.
The recent surge in Bitcoin’s value on eToro has been attributed to various factors, including institutional developments. One such event was BlackRock’s pursuit of launching a Bitcoin-based exchange-traded fund (ETF). The news of this endeavor contributed to the positive market sentiment surrounding Bitcoin, according to Cryptonomist.
Another contributing factor to the upward price movement is the dwindling supply of Bitcoin tokens available for trading.
The theoretical total maximum supply of Bitcoin is 21 million coins. As of right now, 19,413,143 of those are already in circulation, meaning the total number of unmined Bitcoin is less than two million, or just under eight percent left.
Glassnode’s data reveal that the number of “whole-coiners” — individuals who own at least one whole Bitcoin — has surpassed one million. This steady increase in adoption over the past decade indicates a growing interest in Bitcoin beyond its price fluctuations.
Interestingly, the second-largest cryptocurrency Ethereum has not followed Bitcoin’s rally in tandem. Historically, both cryptocurrencies moved in sync, but recent performance disparities have emerged.
Despite having higher market activity, Ethereum’s price has shown minimal variation, fluctuating between $1,800 and $1,900 throughout the past month while Bitcoin surged.
Increasing interest
Introducing new Bitcoin ETF deposits in the U.S. has generated significant interest among institutional investors.
The new ETF is expected to go live on Tuesday after the Securities and Exchange Commission (SEC) appears to have given the go-ahead.
According to the SEC filing, the ETF sponsored by Volatility Shares Trust will soon be available on the CBOE BZX Exchange, with the ticker symbol BITX.
The filing clarifies that the fund aims to achieve investment outcomes that mirror the two times (2x) performance of the Chicago Mercantile Exchange (CME) Bitcoin Futures Daily Roll Index.
The ProShares Bitcoin Strategy ETF (BITO), a Bitcoin futures fund offered in the U.S., experienced a record weekly flow, indicating a surge in demand for regulated exposure to Bitcoin.
Bloomberg senior analyst Eric Balchunas tweeted, “The Bitcoin Futures ETF $BITO had its biggest weekly inflow in a year as assets top $1b again.”
BITO’s appeal lies in its close tracking of Bitcoin’s spot prices, making it an attractive option for traders. The fund currently holds over $1 billion in CME Bitcoin Futures, further reinforcing institutional interest in gaining exposure to Bitcoin through regulated means.
The 2x bitcoin ETF $BITX has become effective, scheduled to launch Tuesday. I was doubtful it would happen but looks like it’s official. Could this be early sign of SEC lightening up? After $BITO launch I believe they made earlier 2x filers withdraw pic.twitter.com/XXxSt9xypu
— Eric Balchunas (@EricBalchunas) June 23, 2023
Noteworthy correlations have been observed between Bitcoin’s price rally and increased liquidity in China. Analyst Tedtalksmacro highlighted this trend, emphasizing that Chinese liquidity growth aligns with Bitcoin’s upward movement throughout the year.
The actions taken by the People’s Bank of China, including quantitative easing measures, have indirectly influenced the cryptocurrency market, boosting its overall market capitalization.
Hong Kong has also emerged as a promising player in the cryptocurrency industry. As part of the People’s Republic of China, the region aims to become a major cryptocurrency hub in Asia.
In June, Hong Kong plans to fully legalize cryptocurrencies’ buying, selling, and trading, positioning itself as an entry point for mainland Chinese institutions venturing into the crypto sector.
