Bitcoin makes gains after regulatory approvals in US

Bitcoin’s value is surging. The leading cryptocurrency has seen a 22% increase this year, reaching $52,005 and surpassing the $1 trillion market value for the first time since its peak in late 2021. This revival has sparked excitement across the cryptocurrency market, with ether and other digital currencies also witnessing gains, pushing the sector’s total value above $2 trillion, according to CoinGecko data.

The momentum is partly due to U.S. regulatory approvals for several bitcoin spot exchange-traded funds (ETFs) from major firms like BlackRock and Fidelity, enabling investors to access bitcoin through conventional stock exchanges. In the first month following their launch, these U.S. spot ETFs amassed 60,000 bitcoin, doubling the output of miners during the same timeframe, as reported by brokerage Bernstein.

“The inflow of funds has exceeded everyone’s expectations,” noted Mark Connors, head of research at 3iQ Corp in Canada. Furthermore, cryptocurrency trading volumes remain strong, with total spot trading on centralized exchanges climbing 4.4% to $1.4 trillion in January. This marks the fourth consecutive month of growth and the highest level since June 2022, according to a report by CCData, a London-based research firm.

This renewed interest has also benefited Coinbase Global, the largest publicly traded crypto exchange, which announced its first quarterly profit in two years last week. Analysts at J.P. Morgan attribute the rise in bitcoin value to improved flows into spot bitcoin ETFs, which in turn drives up bitcoin prices and boosts the value of other cryptocurrencies as well.