Bitcoin surges to as high as $49,000 as US regulator confirms approval of first-ever crypto ETF
The SEC has approved the very first crypto ETF
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Bitcoin has surged in volatile trading after the Securities and Exchange Commission (SEC) confirmed the first-ever sport bitcoin exchange-traded fund (ETF).
The cryptocurrency topped $49,000 following the news, reaching levels not seen since December 2021.
At time of publication, Bitcoin was valued at $46,540.99, according to CoinBase.
The price of Ether rose to $2,614.08 to levels not seen since May 2022 as the crypto industry reacted to the ETF approval.
Crypto enthusiasts hope the approval will push Bitcoin and other currencies into the mainstream
GETTYIn August 2023, crypto asset manager Grayscale won its legal battle with the SEC over its refusal to let it convert its popular Bitcoin Trust (GBTC) into an ETF.
This led to renewed optimism over the likelihood of the regulator giving the green light to the fund at a later day.
After the news of the SEC’s decision, Bitcoin initially edged lower as many traders expected and the volume of inflows into the new funds remain to be seen.
However, bitcoin ETFs are forecast to drive both demand and price of the cryptocurrency even further.
What is an ETF?
This type of fund is viewed as a simpler way for people to invest in assets or a group of assets without having to directly buy the assets themselves.
Since Bitcoin began trading, those wanting to own one would have to adopt a digital wallet or open an account with a crypto trading platform.
However, with the first Bitcoin ETF being approved, cryptocurrency will be more accessible to the wider public as ETFs can be easily traded on stock exchanges.
Certain products are expected to begin trading as soon as today with crypto enthusiasts confident the approval will push cryptocurrency further into the mainstream.
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The cryptocurrency saw a surge following today's approval by SEC
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Today’s news comes after a turbulent 24 hours for bitcoin after a social media post from the account of the SEC announced the approval of the ETFs yesterday (January 10).
The price of Bitcoin spiked by more than $1,000 after this development but the SEC later confirmed the account had been “compromised” and the post was “unauthorised”.
Even with its is approval of a bitcoin ETF, the SEC has reiterated its scepticism over cryptocurrencies and urged traders to be cautious.
The regulator’s chairman Gary Gensler said: “Investors should remain cautious about the myriad risks associated with bitcoin and products whose value is tied to crypto.”