After BlackRock and Grayscale's Victory, Bitcoin Price Approaches $35,000 for the First Time this Year

The price of Bitcoin (BTC) surged 17% within 24 hours, reaching a daily high of $34,741 on October 23rd.

Although the Bitcoin price briefly retraced to $32,914, the appearance of the Relative Strength Index (RSI) led to further upward movement. The increase in buying power may drive BTC to the psychological level of $35,000.

BTC/USDT 3-Day Price Chart, Source: TradingView.

The strong surge in Bitcoin prices is attributed to two key developments by BlackRock and Grayscale. Both events have further fueled the trend towards the imminent launch of a spot Bitcoin ETF.

In a recent report by ETF expert Eric Balchunas, the iShares Bitcoin Trust has been listed on the Depository Trust & Clearing Corporation (DTCC), the largest global financial post-trade services provider responsible for trade settlement at Nasdaq. BlackRock's spot Bitcoin ETF product is referred to as "IBTC."

Earlier, BlackRock stated in the recent spot Bitcoin ETF amendment that they would inject seed funding into the ETF in October. It's worth noting that a seed ETF refers to initial capital provided by banks or broker-dealers to purchase a certain number of creation units (in this case, BTC) in exchange for tradable ETF shares in the public market.

According to Eric Balchunas, seed funding is usually not substantial enough to fully operate an ETF. However, the disclosure of this fact, along with their actions, assists the progress of BTC spot trading.

Furthermore, there are reports indicating that Grayscale's victory was upheld after a court ruling favoring investment firms instead of the SEC, requiring the commission to review BTC ETF applications.

What is an ETF?

An Exchange-Traded Fund (ETF) is an investment tool or index that tracks the price of an underlying asset, such as a Bitcoin ETF tracking the price of Bitcoin. ETFs can track not only individual assets but also a group of assets and industries.

Has a Bitcoin Futures ETF been approved?

Yes. The first Bitcoin futures ETF in the United States was approved by the U.S. Securities and Exchange Commission (SEC) in October 2021. Seven Bitcoin futures ETFs have been approved so far, with over 20 others awaiting regulatory approval. The SEC mentioned that the cryptocurrency industry is nascent and susceptible to manipulation, which is why it has been delaying the introduction of cryptocurrency-related futures ETFs in recent years.

Has a Bitcoin Spot ETF been approved?

Bitcoin spot ETFs have been approved outside of the United States, such as in Europe, but none have received approval in the country yet. BlackRock's application for a Bitcoin spot ETF on June 15th reignited interest around cryptocurrency ETFs. Grayscale's initial proposal for a Bitcoin spot ETF was rejected by the SEC, but their victory in court on August 29th forced the U.S. regulatory agency to reconsider their proposal. The SEC's loss in this lawsuit has raised hopes that a Bitcoin spot ETF may be approved by the end of this year.