Bitcoin, Surpassing The $31,000 Mark, Soared to Its Pinnacle for This Year

The value of Bitcoin (BTCUSD) surged to its peak this year, and has risen nearly 90%, as traders flock back to the dominant Cryptocurrency by market capitalization following a turbulent 13-month period for digital asset markets marked by numerous insolvencies and exchange collapses.

Key TakeAway

• Bitcoin's value reached an annual peak surpassing $31,000 on Friday.
• BlackRock's ETF proposal has heightened investor interest in the digital currency.
• Furthermore, the SEC granted approval for a double-leveraged ETF, set to commence trading on Tuesday.

While still significantly lower than its record-breaking peak of approximately $68,000 in November 2021, Bitcoin's value surpassed the $31,000 mark, marking the first time since April when it briefly reached $31,005. Prior to that, the digital currency had not traded above $30,000 since June 2022, prior to the upheaval that ultimately resulted in the downfall of FTX in November.

What's Propelling Bitcoin Prices?

Bitcoin has experienced a resurgence in attention following the submission of an application for a physical bitcoin exchange-traded fund by BlackRock (BLK), a prominent asset management firm. BlackRock's application stated that its iShares Bitcoin Trust would only issue new shares if they were fully backed by BTC in a 1:1 ratio.

In response to this development, other established financial institutions like Invesco (IVZ) and Wisdomtree (WT) took note and refined their previously rejected applications.

Investors are now optimistic that the authorization of these new ETFs by the Securities and Exchange Commission (SEC) could result in a significant increase in trading volumes for digital assets. Thus far, the regulatory body has dismissed applications for spot bitcoin ETFs.

However, in an unexpected move, the SEC granted approval for a 2X leveraged bitcoin fund. A 2X leveraged ETF is technically considered to carry higher risk compared to a spot ETF. The Volatility Shares' 2X Bitcoin Strategy ETF will be available for trading under the BITX symbol starting from June 27.

Despite the collapse of the FTX exchange and the challenging regulatory landscape, the cryptocurrency sector has managed to rebound this year. Cameron Winklevoss, the founder of the troubled Gemini and Genesis crypto firms, remarked that the opportunity to purchase bitcoin before the "floodgates" of ETFs open is swiftly diminishing.