Explore the recent surge in Bitcoin’s price, reaching new annual highs of around $31,500. CCData’s latest Digital Asset Management Review, published yesterday.
The price of Bitcoin skyrocketed in June, reaching new annual highs of around $31,500, Although the ETF seemed to have provided the majority of the lift, there were actually additional catalysts or favorable reasons. That is what the most recent Digital Asset Management Review from CCData, which was published yesterday, shows.
Despite the fact that Bitcoin ETFs have been available for some time, the price of BTC has increased as a result of two pieces of news.
The first is the US’s first leveraged ETF on Bitcoin receiving SEC approval. This ETF has a target return of 2x and is based on futures contracts on the price of bitcoin.
The SEC has so far approved a number of ETFs for the US market that are based on Bitcoin futures, but no leveraged ones.
Additionally, it hasn’t yet allowed any collateralized directly in Bitcoin, or “on spot” Bitcoin.
News of BlackRock’s attempt to have one approved in this regard has generated controversy because numerous previous attempts to do so have been unsuccessful.
The price of BTC jumped from $25,000 to $26,000 on the exact day of the announcement, indicating that BlackRock has an extremely high approval percentage of over 99%.
Although these two pieces of news were most likely the ones that most significantly supported or precipitated the current uptick in Bitcoin’s price, they were not the only ones to have an impact on the cryptocurrency markets.
In fact, the study from CCData shows that a number of important advances in digital asset investment products took place in June.
For instance, well-known names in traditional finance like Fidelity, Charles Schwab, and Citadel announced the opening of EDX Markets.
According to the research, Bitcoin Cash in particular profited because its value increased as a result of being listed and traded on the site. Even though it is still down -94% from its 2017 highs, it increased by 116% in less than 10 days.
AUM for all digital asset products increased overall by 9.05% to $33.4 billion. Additionally rebounding, aggregate average daily volumes for digital asset items increased by 6.77%.
Total assets under management for digital asset investment products have increased by +69.5% to date, with those focused only on Bitcoin increasing by 12.4% in June.
It is important to note that these indicators decreased in April and May.
Even Grayscale’s Bitcoin Trust (GBTC) had a 78.9% rise in trading volumes in June, in part because of headlines about ETFs.
The market share of Bitcoin-based investment products in the field of digital assets is now 73.1%, up 3.0% from May. Those for Ethereum stop at 23.1%, which is likewise a decrease from May’s 24.5%.
In the end
Given all of this, the report from CCData claims that Bitcoin has established itself as a reliable asset class that allows investors to diversify their portfolios.
Since it cannot be controlled by any central government and can therefore be helpful in the event of a significant monetary expansion, it has drawn a great deal of interest from mainstream investors in recent years.
In addition, notwithstanding what is not taking place in the US in this regard, broad regulatory frameworks for exchanges and cryptocurrencies are becoming clearer.
For more risk-averse investors to feel at ease trading within digital asset markets, however, there is still a long way to go.
Additionally, it’s likely that institutional investors seeking exposure to these assets will favor cryptocurrency investment products like ETNs and ETFs, which make cryptocurrencies more approachable for investors by allowing them to be traded on conventional exchanges without the hassle of safe custody.
The overall image that thus emerges is therefore optimistic, albeit still being far from ideal.