Bitcoin rallied toward $60,000 on Friday.
OZAN KOSE/AFP/Getty ImagesThe price of Bitcoin spiked above $59,500 early Friday as traders became more confident a futures exchange-traded fund could finally be approved.
The Securities and Exchange Commission is set to allow the first U.S. Bitcoin futures ETF to start trading next week, Bloomberg reported early Friday, citing people familiar with the matter. The regulator is unlikely to block products from beginning to trade, those people said. The proposals by ProShares and Invesco are based on futures contracts, differentiating them from those previously rejected, the report noted.
It comes after the SEC’s investor education office posted a tweet on the matter late Thursday. “Before investing in a fund that holds Bitcoin futures contracts, make sure you carefully weigh the potential risks and benefits,” it said, linking to a June bulletin on Bitcoin futures funds.
Those developments have given rise to hopes that a Bitcoin ETF approval is imminent, more than eight years after the Winklevoss twins first sought approval.
The world’s largest cryptocurrency, which has had a volatile year even by its own standards, reached its highest level since April and was heading toward $60,000 following the news. It reached all-time highs near $65,000 in April before sinking below $30,000 in July.
However, fresh records could now be in sight, Will Morris, of digital asset broker GlobalBlock, said. “All-time highs of nearly $65,000 will be the next resistance level before a potential price discovery phase. While the price has fiercely rallied over the past few weeks, Bitcoin balance on exchanges remains at the lowest levels in nine months, indicating investors are holding Bitcoin in wallets rather than readying themselves to sell.”
It has been a busy week for the crypto space. Russian President Vladimir Putin said cryptocurrency “has the right to exist and can be used as a means of payment,” in an interview with CNBC, suggesting tolerance amid increased regulatory scrutiny. Bank of England deputy governor Jon Cunliffe called for urgent regulation earlier this week and warned that a crypto crash could trigger a financial meltdown.
An MSCI report also highlighted the growing influence of crypto in portfolios. At least 52 companies representing $7.1 trillion in market capitalization have exposure to crypto, it said.
Write to Callum Keown at callum.keowndowjones.com
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