Bitcoin (BTC) has experienced a remarkable surge in value, soaring by approximately 60% in just two months since the launch of spot Bitcoin exchange-traded funds (ETFs). On Tuesday, BTC reached a highly anticipated new all-time high, surpassing $69,000, mere months after the approval and availability of ten spot Bitcoin ETFs.
While experts acknowledge that this milestone would have been achieved eventually, they attribute the rapid timeline to the introduction of these ETFs. Seth Ginns, managing partner and head of liquid investments at CoinFund, stated, “The new all-time high would have happened without the ETFs, but we’ve likely accelerated this cycle with the ETF flows.”
Despite Grayscale’s GBTC losing more than 200,000 Bitcoins from its holdings since the ETF launched in January, the spot funds have collectively accumulated nearly 163,000 tokens, according to BitMEX data. Notably, BlackRock’s IBIT and Fidelity’s FBTC alone hold over 196,000 Bitcoins, reflecting substantial institutional demand.
Jim Iuorio, managing director of TJM Institutional Services and a veteran futures and options trader, emphasized the significance of the ETFs as a tailwind but also highlighted broader economic factors driving the rally. “I think the introduction of the ETF was a significant tailwind and, without it, we wouldn’t be at all-time highs,” Iuorio said, citing anticipation of lower benchmark interest rates by the U.S. Federal Reserve and the end of the Bank Term Funding Program, an emergency platform established by the Fed in 2023 to address potential banking crises.
Iuorio further explained, “The bid in all of crypto is a ‘no confidence’ vote for the stewardship of fiat currencies and the potential for the Fed to restart quantitative easing and accommodative policy to assist in a pinch.”
Notably, the rally in Bitcoin’s price gained momentum after BlackRock’s June 2023 announcement of its intention to open a spot fund and Grayscale’s victory in its court case challenging the SEC’s rejection of its spot ETF hopes.
As the cryptocurrency ecosystem continues to evolve, the introduction of spot Bitcoin ETFs has undoubtedly catalyzed the unprecedented growth of the world’s largest digital asset, attracting a broader range of investors and contributing to its meteoric rise to new heights.
