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Bitcoin Jumps to Near $28K as Bulls Bet on ETF Approval
Traders could be betting on a development that buoys hopes for a spot bitcoin ETF in the US.
Updated Oct 16, 2023, 3:47 p.m. Published Oct 16, 2023, 6:29 a.m.
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Bitcoin jumped some 4.5% in the Asian morning hours Monday amid hopes that a bitcoin exchange-traded fund (ETF) could get approved in the coming months, sparking bullish hopes.
Latest News: Bitcoin Momentarily Hits $30K on False Spot ETF Approval Report, Leads to $100M Liquidations
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Bitcoin traded just under $28,000, reversing all losses over the past week. The jump seemed to be a continuation of Friday’s reaction to the U.S. Securities and Exchange Commission (SEC) decision to not appeal to a recent Grayscale ruling.
The SEC will apparently not appeal a court reversal of a decision to Grayscale convert its popular bitcoin trust into a more investor-friendly exchange-traded fund, according to a person familiar with the matter, possibly clearing the way for the first bitcoin ETF in the U.S.
This helped boost the odds the Grayscale Bitcoin Trust (GBTC) can be turned into a more appealing ETF, some traders said.
"The news in the U.S. over Grayscale’s ETF application has potentially very significant ramifications for the bitcoin market. The story of spot price ETF approval has been a dominant narrative in the bitcoin market for several months now," said Simon Peters, market analyst at eToro, in a note to CoinDesk.
"As the barriers to approval fall, hopes among investors continue to rise that we could see these products in the market sooner rather than later," Peters added.
UPDATE (Oct. 16, 08:53 UTC): Adds analyst comment.
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Small investors are buying bitcoin. For a rally to succeed, the whales need to join in.
Small wallets have increased their BTC holdings by 2.5% since October's all-time high while large holders trimmed 0.8%, Santiment data shows.
What to know:
- Bitcoin wallets holding less than 0.1 BTC have increased their share of supply to the highest since mid-2024 even as the price holds around the mid-$60,000s.
- Larger holders with 10 to 10,000 bitcoins — the whales and sharks that typically drive major moves — have reduced their positions since the October peak.
- The divergence supports choppy, fragile price action because retail demand alone cannot sustain rallies when big wallets are distributing into every recovery.
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