Bitcoin hits all-time high following UK’s approval of cryptocurrency asset
OAN’s Elizabeth Volberding
3:00 PM – Monday, March 11, 2024
Following the approval of an investment vehicle supported by cryptocurrencies by a United Kingdom financial regulator, Bitcoin rose to a record high of over $72,000 on Monday.
Monday saw a milestone high for Bitcoin as it broke above $72,000 for the first time ever.
After suffering a severe year-long bear market that featured a near-80% price loss, the cryptocurrency has decisively broken beyond its record high of $69,000 set in November 2021.
Since there appears to be an imbalance in the supply and demand of Bitcoin, investors are suddenly calling for more of the cryptocurrency. Monday’s trading showed that Bitcoin reached $72,166, just a few days after it exceeded the previous peak of around $69,000 from November 2021.
Since spot bitcoin exchange-traded funds (ETFs) were introduced in January, demand for Bitcoin has increased, with over $20 billion flowing into the two most well-liked Bitcoin ETFs provided by Fidelity and BlackRock.
The price of bitcoin fell by 10% after surpassing that barrier last week before rising to its present levels.
The UK agency in charge of overseeing financial matters, the Financial Conduct Authority, said that it will “not object” if exchanges establish a market segment for exchange-traded notes, or cETNs, backed by cryptocurrency assets that are listed in the UK.
The financial instruments that will soon be available allow traders to purchase and sell assets whose prices change in tandem with a certain cryptocurrency. Traders can effectively invest in cryptocurrencies through publicly listed assets, getting rid of the hassle and technical difficulty of actually obtaining a cryptocurrency.
The Financial Conduct Authority warned traders about the risks involved with investing in cryptocurrencies even though it approved cETNs. The authority also stated that the products will not be offered to retail investors.
“The FCA continues to remind people that crypto assets are high risk and largely unregulated. Those who invest should be prepared to lose all their money,” the agency said in a statement.
The record-high comes after the United States Securities and Exchange Commission (SEC) authorized Bitcoin Exchange-Traded Funds, or Bitcoin ETFs, in January.
Additionally, investors can invest in an asset that follows the price movement of Bitcoin through a Bitcoin ETF without having to put money into the cryptocurrency itself.
The price of Bitcoin skyrocketed after the SEC’s approval of Bitcoin ETFs, driven up by a wave of new investment.
Several Bitcoin ETFs became available shortly after the SEC approved the new investment option. These included products from established companies like Franklin Templeton and Fidelity.
The price of Bitcoin has increased by 54% since the approval of Bitcoin ETFs on January 10th.
Bitcoin’s price has historically fluctuated significantly, due to the current gains that have occurred at a quick pace.
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How have spot bitcoin exchange-traded funds (ETFs) contributed to the increased demand for Bitcoin?
Itcoin breaking the $72,000 mark on Monday, following the approval of an investment vehicle supported by cryptocurrencies by a United Kingdom financial regulator. This milestone high comes after a period of bearish market conditions for Bitcoin, with the cryptocurrency experiencing a near-80% price loss in the past year.
Bitcoin’s previous record high of $69,000, set in November 2021, has now been decisively broken. The sudden surge in demand for Bitcoin can be attributed to an apparent imbalance in the supply and demand for the cryptocurrency. Investors are now calling for more of this digital asset, leading to a rapid increase in its value.
The introduction of spot bitcoin exchange-traded funds (ETFs) in January has contributed to the increased demand for Bitcoin. With over $20 billion flowing into the two most popular Bitcoin ETFs offered by Fidelity and BlackRock, investors now have easier access to invest in Bitcoin.
Despite surpassing the $72,000 mark, the price of Bitcoin experienced a temporary 10% drop before rising to its present levels. This volatility is characteristic of cryptocurrencies and highlights the risks associated with investing in this asset class.
The United Kingdom’s Financial Conduct Authority, responsible for overseeing financial matters, has stated that it will not object to exchanges establishing a market segment for exchange-traded notes (cETNs) backed by cryptocurrencies. These financial instruments enable traders to invest in cryptocurrencies through publicly listed assets without actually owning the digital asset itself.
While approving cETNs, the Financial Conduct Authority has also warned traders about the risks involved in investing in cryptocurrencies. It emphasizes that crypto assets are high risk and largely unregulated, and individuals should be prepared to lose all their money.
The record-high for Bitcoin comes after the United States Securities and Exchange Commission (SEC) authorized Bitcoin Exchange-Traded Funds in January. Investors can now invest in assets that follow the price movement of Bitcoin through these ETFs without directly owning the cryptocurrency.
The approval of Bitcoin ETFs by the SEC has sparked a wave of new investments, driving the price of Bitcoin up. Established companies like Franklin Templeton and Fidelity have also introduced Bitcoin ETFs, further fueling investor interest.
In conclusion, Bitcoin’s price reaching a record high of over $72,000 reflects the increasing demand for cryptocurrencies, fueled by the approval of investment vehicles such as ETFs. However, investors must be cautious as cryptocurrencies remain highly volatile and pose significant risks. Regulatory bodies like the Financial Conduct Authority continue to warn individuals about the dangers of investing in this asset class.
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