Bitcoin climbs over $45,000 for the first time since 2022

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Bitcoin, the world’s largest cryptocurrency by market capitalization, has surpassed the $45,000 mark. The recent surge to $45,532 represents a notable rebound from its 12 month low of $16,304 in January 2023.

Ethereum also saw gains of over 7% in the past week, surpassing the $2,300 mark, a rebound from its 12 month low of $1,201 in January 2023. The price resurgence, especially for BTC, comes as investors anticipate potential regulatory approval of spot bitcoin exchange-traded funds (ETFs) in the US.

Exchange-traded funds (ETFs) are investment funds traded on stock exchanges, similar to stocks. Crypto ETFs track the prices of one or more cryptocurrencies. Investing in a crypto ETF can appeal to retail and institutional investors looking to gain exposure to the crypto market while avoiding some of the risks of owning crypto assets directly. For example, a crypto ETF investor would not need to personally manage crypto wallet security or custody. 

The Securities and Exchange Commission (SEC) has rejected similar proposals in recent years. Still, some media news suggest that the SEC will approve a portion of the 13 proposed Bitcoin ETFs by or before January 10th of this month. 

In addition to possible ETF approvals, rising expectations of central bank interest rate cuts have boosted risk asset prices. Some analysts predict elections in the US could further aid cryptocurrency markets in 2024, continuing the bullish momentum.

In previous years, such as 2012, 2016, and 2020, surges in Bitcoin prices have aligned with US election cycles and “halving” events. As the next halving event approaches in April 2024, the overall market environment for Bitcoin has become increasingly favorable, especially following recent periods of volatility.

In 2024, the upcoming US Elections will likely significantly impact the cryptocurrency markets, as various indicators suggest that a bullish trend will continue. Crypto-supported super PACs are providing substantial financial support, and the commitments of presidential candidates to endorse the crypto industry point towards a potentially favorable environment for crypto-related policies and regulations following the elections.

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