Bitcoin gave traders a glimpse into the possible impact of a looming US Securities & Exchange Commission decision on whether to allow exchange-traded funds that invest directly in the token.
An erroneous report that BlackRock Inc. had won approval to launch a spot ETF rapidly sent the largest digital asset to $30,002 on Monday, the highest price since March. The move cooled after the world’s biggest money manager said its application remains under review, leaving Bitcoin 4.4% higher for Oct. 16.
BlackRock is among about a dozen firms seeking to offer the first US spot Bitcoin ETFs amid expectations that the SEC may soon end its opposition to the products. Optimists argue such funds will help spur wider crypto adoption.
“This was like a dry run for what’s going to happen if these things actually do get approved,” Bloomberg Intelligence ETF analyst James Seyffart said. “It basically gave traders a playbook.”
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Speaking on Bloomberg Television, Seyffart said he expects a batch of spot Bitcoin ETFs to be approved by a January deadline.
The Bitcoin swings punctured — if only briefly — a period of low volatility that reflects a lack of buyer interest. Many investors have deserted virtual coins following last year’s rout and blowups like that of the FTX exchange, whose co-founder Sam Bankman-Fried is on trial for a multibillion-dollar fraud.
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