The price of bitcoin has shot up following news that US regulators are set to finally approve the launch of a futures exchange-traded fund (ETF) for the cryptocurrency.
Bitcoin surged nearly $3,000 in less than an hour on Friday morning, reaching $59,924 according to CoinMarketCap’s price index. It is now less than $5,000 away from its all-time high that it experienced back in April.
The Securities and Exchange Commission (SEC) is expected to announce the long awaited bitcoin futures ETF as early as next week, according to a report in Bloomberg that cited sources close to the matter.
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The official Twitter account from the SEC’s investor education office also signalled that an announcement is imminent, posting a link to a bulletin warning about the risks of futures trading in bitcoin.
“Investors should understand that bitcoin, including gaining exposure through the bitcoin futures market, is a highly speculative investment,” it states. “As such, investors should consider the volatility of bitcoin and the bitcoin futures market.”
The price surge comes amid a major rally for the broader crypto market, which has seen its overall market cap overtake the world’s most valuable company.
Bitcoin accounts for less than half of the value, with its market cap of $1.12 trillion ranking it above other tech giants like Facebook and Tesla.
Bitcoin has experienced gains of nearly 40 per cent since the start of October, with some analysts predicting a record-breaking end to 2021.
“Bitcoin has been holding up very well over the last several days – most likely due to the anticipation of a bitcoin futures ETF being approved by the SEC,” Will Hamilton, head of trading and research at digital asset management firm TCM Capital, told The Independent.
“It is going to be a very interesting next several months, with over 16 bitcoin ETFs still awaiting approval from the SEC. Keep an eye on this space.
