Asia’s crypto craze: Bitcoin’s impressive ascent fuels ETF hopes

The cryptocurrency market witnessed a notable surge in Asia, with Bitcoin reaching a near 18-month high. The climb in value today, October 24, by over 6% to US$35,198, is the highest recorded since May 2022 and is the result of speculation around the potential launch of a Bitcoin exchange-traded fund (ETF).

Monday, October 23, saw Bitcoin’s best session in almost a year, with its price doubling in the year 2023. This upward trend also benefited crypto-linked stocks such as Coinbase Global and MicroStrategy, both of whom experienced a rise in after-hours trades. Ether, another popular cryptocurrency, also broke above the US$1,800 mark.

The introduction of a Bitcoin ETF, giving fund investors ownership of Bitcoin, is believed to be a significant driver of demand. It provides a solution for those hesitant about trading in the crypto market, allowing them to gain exposure to Bitcoin through the stock market.

Several firms, including investment giant BlackRock, have pending applications for Bitcoin funds in the United States. Speculation around their likely approval has increased following the listing of BlackRock’s iShares ETF on the website of clearing house DTCC.

Further fuel to the anticipation was added by reports earlier this month, from sources including Reuters, suggesting that the US Securities and Exchange Commission (SEC) will not appeal a court ruling that they had been incorrect in rejecting an ETF application from Grayscale Investments.

Steen Jakobsen, CIO at Saxo, commented on the situation.

“The value of an asset … any asset basically, is the number of people using it. So, the ETF would make a large audience and increase liquidity.”

BlackRock

However, the reasoning behind the addition of the iShares ETF to the DTCC list remains unclear. Both DTCC and BlackRock have yet to respond to requests for comments on the matter. Despite a previous inaccurate report claiming the approval of BlackRock’s ETF, sources close to the SEC confirmed the application is still under review.

Crypto derivatives analysis site, Coinglass, has shown a significant amount of bitcoin short-covering in the past 24 hours.

The surge in cryptocurrency also coincides with escalating concerns in broader markets about the potential for Israel’s conflict with Islamist group Hamas to evolve into a wider regional conflict, reported Bangkok Post.

Analyst Kyle Rodda at Capital.com suggested that the geopolitical unrest, coupled with radical Javier Milei emerging as a frontrunner for Argentina’s presidency, could be factors contributing to the increased demand for Bitcoin, often viewed as a store of wealth during times of crisis.

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