Crypto growth in the start of 2024 offsets losses in traditional markets
Crypto growth in the start of 2024 offsets losses in traditional markets
Bitcoin is up more than 6% since the beginning of 2024, helping to offset a weak start in other global markets.
On Jan. 3, Bitcoin traded solidly above $45,000 during the Asian session on expectations that the U.S. Securities and Exchange Commission (SEC) will soon approve the first-ever spot Bitcoin ETF in the U.S. The rise of the largest cryptocurrency by market cap has contributed to the rise of smaller tokens such as Solana and Avalanche.
However, the positive momentum in the crypto market is the complete opposite of the trend seen on other platforms. According to Bloomberg, U.S. stock futures remain under pressure after U.S. stocks fell on the first day of trading in 2024 in traditional markets. The rise in the dollar index also points to general investor caution.
Expectations of the approval of the first spot Bitcoin ETF in the U.S. are the main driver of the BTC price at the moment. James Seyffarth, an analyst at Bloomberg Intelligence, believes that the SEC will approve several Bitcoin ETF applications simultaneously before January 10.
Despite BTC's growth of more than 170% over the past 12 months, it remains to be seen whether ETFs will be able to make it a more popular asset and facilitate the influx of new funds.
Analysts Anders Helseth and Vetle Lunde of K33 Research said they do not expect a rapid influx of funds into ETFs and categorize the event as a "sell the news" event. However, they believe these products herald a longer-term structural shift in buyer interest.
According to K33 Research's latest forecasts, there is a 75% chance that the approval will be "sell the news" event and a 20% chance that Bitcoin will continue to rise.
The cryptocurrency market is also supported by expectations that the Federal Reserve will shift to a policy of lower interest rates in 2024.
Further reading: Price of Bitcoin is targeting the $48,000 mark.
