Bitcoin’s meteoric rise hit a speed bump as traders locked in profits after a week of euphoria. This pushed the cryptocurrency up by as much as 25%. The Bitcoin recovery was fueled by optimism surrounding a potential US spot exchange-traded fund (ETF) approval.
While Bitcoin experienced a temporary lull, other major tokens displayed mixed performance. Cardano’s ADA saw a 2.00% decline, whereas Solana’s SOL tokens continued their week-long rally with a nearly 30.00% increase. The rise in SOL tokens came as fears of an FTX bankruptcy estate sell-off were downplayed.
The CoinDesk Market Index (CMI), a comprehensive tracker for numerous tokens, indicated a 0.42% increase, reflecting modest gains across the crypto market.
Some traders are pointing to signs of institutional adoption as a potential end to the “crypto winter,” a term used to describe a bear market marked by low prices and minimal venture capital investments. The market is showing promise, especially with numerous spot ETF applications in progress.
A Galaxy Digital estimate suggests that Bitcoin profit could surge by 74.10% in the first year following the launch of spot Bitcoin exchange-traded funds (ETFs) in the United States. This estimate is based on the potential price impact of fund inflows, using gold ETFs as a reference.
Galaxy Digital also predicts the addressable market size for US Bitcoin ETFs to reach $26.5 trillion in the second year post-launch and $39.6 trillion after the third year. However, it’s essential to consider potential delays or denials in ETF approval, which could impact these projections.
In addition to ETF prospects, the Bitcoin recovery and increasing acceptance as a digital safe haven have also contributed to its rise. As investors seek portfolio diversification in uncertain times, Bitcoin, often referred to as “digital gold,” offers an alternative to traditional investments in stocks and bonds. The cryptocurrency market is still navigating regulatory and legislative challenges, but the growing interest in Bitcoin remains evident.
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