Crypto is back
Bitcoin prices are surging once more. Hopes are growing for an eventual approval of a spot bitcoin ETF. Crypto stocks are soaring as well.
The SEC may be finally ready to soon approve a spot bitcoin ETF from the likes of iShares/BlackRock, Grayscale and other investment firms. Traders have, unsurprisingly, been buying the rumor. Bitcoin prices have popped to just above $37,000, their highest level in about a year and a half. The world’s most valuable crypto (now around $750 billion again) is up more than 7% in the past week and about 35% in the past month,
It’s worth noting that the rally in bitcoin is also lifting other cryptocurrencies. In other words, the excitement isn’t limited to just BTC. Ether (kind of like the Pepsi to bitcoin’s Coke), BNB/Binance Coin, XRP, Solana, Cardano and even Elon Musk’s beloved dogecoin have soared in the past few weeks too.
The rally for mainstream cryptos and alt/meme coins is boosting shares of several companies with ties to digital currencies. Coinbase skyrocketed more than 10% Thursday and is up about 175% this year. Bitcoin miners Marathon Digital and Riot Platforms have also exploded higher. So have shares of MicroStrategy, the software firm who has bitcoin evangelist Michael Saylor as a co-founder, executive chairman and former CEO.
It’s still not clear if crypto fans will eventually sell the expected spot ETF approval news. But bulls are obviously betting that bitcoin prices will one day get back to (and surpass) the all-time high levels of just under $70,000 from late 2021. Who’s to doubt them. It may be a matter of when, not if. The issue though is that following the ginormous rally this year, bitcoin prices may need to enter a cooling off/consolidation phase before taking another leg back up. That’s because no matter what bitcoin proponents might tell you, cryptos are merely another type of financial asset…just like stocks, bonds, commodities and actual government-backed paper currencies. Supply and demand matters. There will be cycles. Bitcoin has had bear markets before and it will do so again. Nothing goes up in a straight line to infinity.