Bitcoin Price Surge | Rumors of Ethereum Spot ETF Approval

Bitcoin's price has skyrocketed to $71,000, driven by rumors of a possible approval for a spot Ethereum ETF in the U.S.

This development has caused a ripple effect, boosting major cryptocurrencies and raising hopes for further market growth. Discover the factors behind this surge and what it could mean for the future of digital assets.

Significant Rise in Bitcoin Price

On May 21, 2024, the price of Bitcoin (BTC) surged back to the $71,000 level. Although it did not surpass its all-time high of approximately $73,800 recorded on March 14, 2024, the current price of $71,379 marks a substantial increase.

Bitcoin had been struggling to break through the resistance line near its all-time high since March. The price had even briefly dipped below $56,000 on May 1, prompting some analysts to warn of a potential drop to around $30,000.

However, the 100-day moving average, maintained since October 2023, continues to act as a crucial support line, raising expectations for further price increases.

Reasons Behind Bitcoin's Price Rise

The primary factor behind Bitcoin's price surge appears to be the rumor that a spot Ethereum ETF might soon be approved in the United States.

Potential Approval of a Spot Ethereum ETF

While the general consensus had been that the approval of a U.S. spot Ethereum ETF was unlikely, on May 21, 2024, Bloomberg ETF analysts James Seyffart and Eric Balchunas raised the probability of its approval from 25% to 75%.

Reports suggest that exchanges have been unexpectedly asked by the U.S. Securities and Exchange Commission (SEC) to update their filings for listing a spot Ethereum ETF. This sudden shift implies that the SEC might reverse its stance and approve the ETF.

The "political issues" referenced in the aforementioned post pertain to the upcoming U.S. presidential election in November 2024. The idea is that failing to approve the ETF could strengthen the perception that the Biden administration is anti-cryptocurrency, which might favor Donald Trump.

On May 9, Trump stated, "If you support cryptocurrencies, you should vote for Donald Trump," and major financial institutions believe that his re-election would benefit the cryptocurrency industry.

Market Reaction to ETF Approval Rumors

Following the news of a potential spot Ethereum ETF approval, the price of Ethereum (ETH) surged by nearly 20% in the past 24 hours. This rally also led to a roughly 10% increase in other major cryptocurrencies.

Bitcoin's price rise is seen as a reaction to Ethereum's surge, along with the continued maintenance of significant support lines and optimistic expectations following the halving.

The sharp increase in the prices of major cryptocurrencies suggests that additional investments might flow into other altcoins, fostering further overall growth in the cryptocurrency market.

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