ALBAWABA – Following the cryptocurrency's longest and biggest rally since May, Bitcoin broke over $44,000 then dipped slightly on Wednesday but held close to the new threshold as hopes built on the prospect of the United States (US) allowing its first spot Bitcoin exchange-traded funds (ETFs).
The world’s top digital asset climbed for six days through Tuesday, gaining around 16 percent, holding at $43,525 as of 0623 a.m. in London, Bloomberg reported, up 163 percent from last year.
Bitcoin broke over $44,000 but dropped around 1 percent on Wednesday, according to Agence France-Presse (AFP). However, consolidated gains in early European trading solidified the cryptocurrency’s position, as per Bloomberg.
Much of the rally is pegged to the prospect of the US allowing its first spot Bitcoin ETFs paving the way to a wider investor base, in addition to hopes the US will see lower interest rates soon.
BlackRock Inc. and Fidelity Investments are among those awaiting the outcome of their applications, with some analysts expecting a green light by January, according to Bloomberg.
Nonetheless, these expectations have been building up since June.
Bitcoin breaks over $44k - Shutterstock
Asset managers, as reported by Bloomberg, expect the surge in Bitcoin demand to be driven by hopes of lower interest rates as early as March next year, rather than the long-anticipated launch of spot Bitcoin ETFs next month.
Ether and other smaller virtual currencies such as Avalanche and meme-crowd favorite Dogecoin have also been advancing.
In Abu Dhabi, crypto mining hardware retailer Phoenix Group Plc jumped 35 percent on its debut on Tuesday, noting that it is the first crypto-related listing in the Middle East.
In El Salvador, Nayib Bukele said in a post on X this week that the nation’s Bitcoin investments had turned profitable. He’s running for re-election after stepping down as president last week.
Another prop for sentiment is the so-called Bitcoin halving due next year, which will cut in half the amount of tokens that Bitcoin miners receive as reward for their work.
The quadrennial event is part of the process of capping Bitcoin supply at 21 million tokens. The coin hit records after the last three halvings.
