Bitcoin price today: slips to $69k while Ether pulls back after ETF hype surge

Published 05/22/2024, 02:05 AM
Updated 05/22/2024, 08:56 AM
© Reuters.
- Bitcoin price dropped slightly on Wednesday as anticipation of more cues on U.S. interest rates saw traders lock in gains from a recent rally on optimism over a spot Ether exchange-traded fund.

World no.2 cryptocurrency Ether also gave up some gains after hitting an over two-month high, propelled by this week’s reports indicating some progress towards the approval of spot ETFs by the Securities and Exchange Commission. The regulator is set to make a hotly-anticipated decision on potentially approving the ETFs later this week.

But warnings on sticky U.S. inflation and high-for-longer interest rates kept traders cautious towards crypto markets and also pulled Bitcoin back from recent gains.

Bitcoin fell 2.1% over the past 24 hours to $69,763.0 by 08:48 ET (12:48 GMT).

Ether retreats after hitting 2-mth high; SEC ETF decision in focus

Ether fell 3% in the past 24 hours to $3,663.08 after nearing the highest level since early-March. The token surged as much as 18% on Monday.

The surge was fueled by media reports suggesting that the SEC had asked exchanges to fine-tune their filings for spot Ether ETFs on Monday, ahead of a crucial decision on their approval later this week.

The move marks some progress towards the approval of the ETFs, although the SEC could still deny the applications, given that it has not engaged with any of the applicants so far.

Still, analysts said the SEC’s move reflected a greater probability of an eventual approval of a spot Ether ETF. The approval is expected to spark a rally in crypto prices, akin to that seen with the approval of spot Bitcoin ETFs earlier this year.

Bitcoin struggles to hold gains, more Fed cues awaited 

The token had risen as far as $71,000 on Tuesday, before falling back into a $60,000 to $70,000 trading range seen over most of the past two months. 

Sentiment towards crypto, despite optimism over a spot Ether ETF, was still constrained by persistent concerns over U.S. interest rates.

Several Fed officials warned this week that the central bank needed more confidence that inflation was coming down before it could begin cutting interest rates. 

Focus was now on the minutes of the Fed’s late-April meeting, for more cues on when the central bank could begin trimming interest rates. 

High for longer rates bode poorly for crypto markets, given that they limit the appeal of high-risk and highly speculative assets. 

Crypto price today: Altcoin rally cools 

Broader altcoin prices also cooled as Bitcoin retreated, while traders remained largely biased towards Ether in the altcoin complex. Resilience in the dollar also limited any major upside in crypto.

Solana slipped 1.6%, while XRP shed 2.3%. Among meme coins, Dogecoin and SHIB each lost 2.8%.

BlackRock (NYSE:BLK) Bitcoin ETF sees biggest inflows since April

IBIT, BlackRock’s spot Bitcoin ETF, is witnessing increased activity after a few quiet weeks, as Bitcoin trades above the $70,000 level for the first time in a month.

Specifically, IBIT saw inflows exceeding $290 million on Tuesday, according to preliminary data from Farside Investors, marking its highest single-day inflow this month and the largest since April 5. This figure is nearly three times the previous monthly high of $93 million recorded on May 16.

As a result, IBIT’s total holdings have now surged to over $19 billion, as indicated on its product page.

Tuesday’s inflows are notably large compared to earlier this month, where IBIT saw low or zero inflows before May 15. In April, IBIT recorded its first-ever day of outflows, contributing to some bearish sentiment for Bitcoin at the time.

Elsewhere, asset manager WisdomTree has received approval from the Financial Conduct Authority (FCA) to list crypto exchange-traded products (ETPs) on the London Stock Exchange (LSE).

WisdomTree said that it is among the first applicants to have its prospectus approved by the U.K. regulator.

The Physical Bitcoin (BTCW) and Physical Ethereum (ETHW) ETPs are set to begin trading on May 28, available exclusively to professional investors. These ETPs will carry fees of 35 basis points, according to the announcement made on Wednesday.

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