Starting in 2024, Bitcoin surpassed $45,000 for the first time since April 2022, driven by increased geopolitical tensions in the Red Sea and expectations for exchange-traded fund approval.
Coin Metrics reported a $45,913.30 intraday high for the largest cryptocurrency on Tuesday morning. The first time it traded above $45,000 since April 5, 2022, that was its greatest level. Last up over 3%, it traded at $44,952.89.
The rise confirmed bitcoin’s significance as an uncertainty hedge, which investors learned last year. Houthi terrorists from Yemen, backed by Iran, attacked a Maersk ship over the weekend in four small boats.
Before the prospective ETF storyline, the U.S. regional banking crisis drove bitcoin’s six-month surge. Bitcoin’s first significant increase of the year helped it stand out as an alternative to the legacy system and hedge against uncertainty.
Traders are hopeful that the U.S. will approve the first bitcoin ETF. Larger institutional investors may be interested in buying a product that follows bitcoin’s price without owning the cryptocurrency.
BlackRock and other possible issuers revised their bitcoin ETF registration forms on Friday, adding authorized participants. Investors assume that extra detail means a U.S. Securities and Exchange Commission decision is imminent. Many industry experts expect January funding.
After a 157% price increase in 2023, many expect bitcoin’s price to rise further.
Investors expect bitcoin to thrive in 2024. January is expected to bring an ETF decision. The Bitcoin halving, which has typically preceded dramatic price hikes, is predicted in the spring. After nearly two years of interest rate hikes that damaged the cryptocurrency, Fed policymakers expect at least three decreases this year.
Other cryptocurrencies rose on Tuesday. Ether traded at $2,367, up about 1%.