Bitcoin price has briefly surpassed the $35,000 mark. This astonishing rally has been fueled by a number of factors that have left investors and cryptocurrency market enthusiasts excited.
One of the main forces behind this rise is the growing institutional interest and investment in Bitcoin. Large financial and asset management companies, such as BlackRock, have been exploring opportunities in the cryptocurrency market.
Institutional Participation in Bitcoin has Instilled Confidence
Anticipation of the approval of a BTC ETF, in particular BlackRock’s iShares Bitcoin Trust, has been another key factor.
Although this ETF is still awaiting approval from the Securities and Exchange Commission (SEC), its listing by the Depository Trust and Clearing Corporation (DTCC) has been interpreted as a significant step towards its launch.
The iShares Bitcoin Trust has been listed on the DTCC (Depository Trust & Clearing Corporation, which clears NASDAQ trades). And the ticker will be $IBTC. Again all part of the process of bringing ETF to market.. h/t @martypartymusic pic.twitter.com/8PQP3h2yW0
— Eric Balchunas (@EricBalchunas) October 23, 2023
Additionally, the regulatory environment around cryptocurrencies has improved, generating greater confidence in the market.
Clarity in regulations and a more favorable attitude towards cryptocurrencies, particularly in the United States, have contributed to this enabling environment.
The pressure on short sellers has also been an interesting feature of this price increase. As the value of Bitcoin surpassed $31,000, a significant liquidation of bearish positions occurred, suggesting that this rise is not solely based on speculative buying, but genuine demand.
Additionally, buying algorithms such as Time Weighted Average Price (TWAP) have been notable in this bull market. This buying pattern, coupled with an increase in liquidity, has suggested considerable interest, possibly from institutional investors.
The cryptocurrency community has also noted the continued growth of the ecosystem, with new applications and use cases constantly emerging. This has brought more investment and attention to the market.
As BTC continues to outperform expectations, many anticipate that the cryptocurrency could surpass $40,000 in the coming days.
This would be a crucial step on the path to a sustained bull market, according to the Market Value to Real Value Ratio (MV Ratio), which currently stands at 1.47. An MV Ratio above 1.5 has historically marked the beginning of a solid bull market.