The total amount invested in bitcoin surpassed $1 trillion for the first time after November 2021, as inflows into U.S. spot bitcoin exchange-traded funds drove cryptocurrency prices higher.
On Wednesday, the total amount invested in bitcoin crossed $1 trillion for the first time since November 2021, as inflows into U.S. spot bitcoin exchange-traded funds pushed cryptocurrency prices higher.
On Wednesday, Bitcoin’s price reached $52,079, its highest level in 25 months. It was last up 4.29% at $51,690, bringing the token’s market capitalization to $1.013 trillion, according to price platform Coingecko.
The world’s largest cryptocurrency has climbed by roughly 22% since the beginning of February, and it is already on track for its highest monthly gain since October.
Strong inflows into new U.S.-listed ETFs have driven some of the price activity in recent weeks, say analysts. Capital flows into the 11 U.S.-spot bitcoin ETFs surged to $1.64 billion in the week to Wednesday, according to LSEG data.
The preceding five trading sessions witnessed $409 million inflows into the products, which obtained regulatory approval and began trading in January.
“Whether this pace will be sustained remains to be seen, but in crypto, price often drives flow,” noted analysts at crypto liquidity service B2C2.
“One has to imagine that if there are more days like the last few, large inflows will be met by further price rises for spot (bitcoin).”
Genesis Global Capital, a bankrupt cryptocurrency lender, won authorization from a US court on Wednesday to sell around $1.6 billion in shares of Grayscale Investments’ spot bitcoin ETF (GBTC.P) as part of its efforts to repay creditors.
According to Coingecko, the all-time high for bitcoin’s market capitalization was $1.28 trillion, set in November 2021.
Bitcoin investments account for more than half of the $2.01 trillion parked in the cryptocurrency market, which also includes ether and other digital coins.
Shares of U.S.-listed cryptocurrency companies rose on Wednesday, with exchange Coinbase (COIN.O) rising 13.5% and miners Riot Platforms (RIOT.O) and CleanSpark (CLSK.O) up 12.2% and 11.3%, respectively.
Bitcoin reached an all-time high of $69,000 in November 2021, but then struggled throughout much of 2022 and the first half of 2023, pushed down by monetary tightening by global central banks and a string of high-profile bankruptcies at crypto firms, including leading exchange FTX.
However, in recent months, predictions of a gentle landing for the economy and the introduction of spot bitcoin ETFs have boosted enthusiasm. The ETFs have been hailed as a game changer for the industry, which is already known for its attraction to retail traders, because they allow investors to obtain exposure to bitcoin without physically owning the commodity.
The second-largest coin, ether, which supports the Ethereum network, was last up 4.9% to $2,762, its best since May 2022.
Do Follow: CIO News LinkedIn Account | CIO News Facebook | CIO News Youtube | CIO News Twitter
About us:
CIO News, a proprietary of Mercadeo, produces award-winning content and resources for IT leaders across any industry through print articles and recorded video interviews on topics in the technology sector such as Digital Transformation, Artificial Intelligence (AI), Machine Learning (ML), Cloud, Robotics, Cyber-security, Data, Analytics, SOC, SASE, among other technology topics.
