The world’s largest cryptocurrency jumped 3% amidst news of a Bitcoin ETF getting approved in the US.
Bitcoin temporarily broke the $60,000 level this morning amid reports of a Bitcoin exchange-traded fund (ETF) nearing approval in the US.
The asset since fell to $59,500 at press time as traders took profits from the $1,500 move. Over $69 million worth of Bitcoin trades were liquidated as a result, data from analytics app Bybt shows.
Bitcoin ETFs and why they matter
ETFs are regulated institutional products that track an index, sector, commodity, or another asset (like crypto) and are majorly used by traditional finance players to bet on such assets or hedge against related sectors.
Approval of a Bitcoin ETF in the US has long been mulled in crypto circles but has mostly seen rejection from the country’s Securities and Exchange Commission. However, such woes seem to be coming to an end—with sources expecting the Bitcoin ETF to be approved as early as this month.
The regulator isn’t likely to block the products from starting to trade next week,” said the people, who asked to remain anonymous. The current Bitcoin ETF applications filed with the regulator are futures-based—unlike previously rejected applicants who filed for a spot-based product— and offered by ProShares and Invesco Ltd.
The contracts were filed under mutual fund rules that SEC Chairman Gary Gensler has said provide “significant investor protections.” This is a changed stance from the previous administration, which distanced itself from regulated crypto offerings in the US.