Bitcoin price is up today, briefly recapturing the $35,000 level as bullish investor sentiment provides BTC with a much-needed tailwind.
Bitcoin (BTC) price is up today, rising to an intra-day high of $35,121. The Bitcoin price increase today comes as hype around a spot BTC exchange-traded fund (ETF) resulted in an increase in spot and CME BTC volumes and this bullish momentum continues to push prices across the crypto market higher.
Although Bitcoin price is encountering some hurdles at the $35,000 level, the reasons for this week’s price move could be a hint at the rally’s sustainability.
Let’s look into the reasons why Bitcoin price is up today.
Institutional interest in Bitcoin boosts market sentiment
Despite a bevy of macro headwinds, Bitcoin price has topped the key $35,000 level two times in the past 2-days. The bullish momentum sent the Crypto Fear and Greed index to its highest level since Bitcoin price hit the $69,789 all-time high in November 2021.
Despite a rush of spot Bitcoin ETF amendments in mid-October, the BlackRock iBTC fund is the first to be listed by a Nasdaq clearing firm.
To date, the SEC has refused to approve a spot Bitcoin ETF despite numerous applicants including BlackRock, Fidelity, ARK Invest and 21Shares which has filed for approval three times. On Oct. 14, Grayscale scored a major victory after the SEC announced that it would not appeal the U.S. Court of Appeals Circuit Judge Neomi Rao’s decision. The decision led Grayscale to file a new spot Bitcoin ETF application on Oct. 19
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What does a spot ETF mean for BTC?
Analysts continue to speculate what a spot Bitcoin ETF approval could do for BTC price. According to reports, an approval may generate $600 billion in new demand. CryptoQuant analysts believe that an ETF approval will lead to a $1 trillion increase in Bitcoin’s market capitalization.
On Oct. 24, Galaxy Digital released a report showing that when Bitcoin ETFs are approved, BTC could see a minimum of $14.4 billion of inflows in the first year, growing to $38.6 billion by year three. The fund also predicts a 74% price increase in the first year after a spot BTC ETF launch.
Charles Edwards, the founder of Capriole Investments, also suggested that gold sprung out of a bear market to generate a 350% return after a Gold ETF was approved.
Related: ‘This is the trigger’ — Arthur Hayes says it’s time to bet on Bitcoin
Bitcoin volumes are the metric to keep an eye on
Coinciding with Bitcoin’s price gains, exchanges continue to see an exodus of BTC. The market perceives coins leaving crypto exchanges as a bullish signal, given traders withdraw their BTC typically when they want to hold it in self-custody long-term.
Despite the increase in Bitcoin leaving exchanges, spot volume has greatly increased. Trading volume on Oct. 25 surged above $35 billion for the first time since March 20.
In comments to Cointelegraph, JLabs Digital co-founder Ben Lilly explained that a notable feature of the price breakout was the sustained spot volumes.
“There were a lot of factors at play here. Conditions were ripe for the market to expose how one-sided the options market was getting. What I find interesting here is the big push didn’t originate from futures, but more on the spot. And I believe this is in part why we didn’t see a quick unwind in the days that followed from the options market normalizing.”
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
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