Bitcoin has surpassed $41,000 for the first time since April 2022. What's behind the price surge?
Bitcoin is once again having a moment
NEW YORK — NEW YORK (AP) — Bitcoin is once again having a moment. On Monday, the world's largest cryptocurrency soared past $41,000 for the first time in over a year and a half — and marking a 150% rise so far this year.
Volatile bitcoin rocketed from just over $5,000 at the start of the pandemic to nearly $68,000 in November 2021, according to FactSet, a period marked by a surge in demand for technology products. Prices fell back to earth during an aggressive series of Federal Reserve rate hikes aimed at taming inflation and then the collapse of FTX, one of the biggest companies in crypto.
When 2023 began, a single bitcoin could be had for less than $17,000 after losing more than 75% of its value. Investors, however, began returning in large numbers as inflation started to cool. And the collapse of prominent tech-focused banks actually led more investors to turn to crypto as they bailed out of positions in Silicon Valley start-ups and other risky bets.
But fueling this latest rally are prospects for the possible approval of spot bitcoin exchange traded funds — a pooled investment security that can be bought and sold like stocks.
Industry advocates say this new way of investing in bitcoin at spot prices, instead of futures, could make it easier for anyone to enter the cryptoverse while lowering some of the well-documented risks associated with investing in cryptocurrencies. Regulators have previously rejected bitcoin spot ETF applications, but recent wins for some crypto fund managers have improved odds for a first approval, perhaps as soon as next month.
“The longer-term catalyst (for bitcoin) is a lot of optimism related to the potential approval of a spot ETF,” Kaiko research
Read more on abcnews.go.com
