- Bitcoin price tagged $64,000 on Wednesday amid a buying frenzy and depleted OTC supplies.
- ETF specialist attributes the surge to ETFs, which brought BTC to Wall Street.
- The ETF craze has seen trading volumes beat their previous peaks.
Bitcoin (BTC) price exploded to an intraday high of $64,000 on Wednesday before a quick retraction. Reports circulated that over-the-counter (OTC) BTC supplies depleted, which could compel institutions to switch to public exchanges as an alternative source of Bitcoin.
Also Read: Bitcoin price rally likely not over as institutions deplete BTC OTC supply
ETF approval brought Bitcoin to Wall Street
Eric Balchunas, an exchange-traded funds (ETF) specialist with Bloomberg Intelligence, says that the approval of ETFs on January 10 acted as the Initial Public Offering (IPO) for Bitcoin.
“Bitcoin ETFs were Bitcoin’s IPO moment, now available to any investor with the click of a button.” this is what i’ve been trying to say to the Underwhelmers. Can’t overstate how easy, cheap, standardized ETFs make stuff, in this case the fact they “regulated” is cherry on top. https://t.co/V5LlYgZG80
— Eric Balchunas (@EricBalchunas) February 28, 2024
For the layperson, an IPO is when a private company’s shares are made available to the public for the first time, effectively allowing a company to raise equity capital from public investors.
Balchunas’ report comes after ETF products broke their own record, surpassing their previous daily peak in trading volume to hit $2.6 billion on Wednesday. Notably, this record happened only halfway through the trading day.
Four BTC ETFs merit inclusion in the top 20 ETF list, and BlackRock’s IBIT takes fourth place overall. With such an explosive turnout before the end of business, Balchunas speculated there could be “more [trading volume] today than in its first two weeks combined.”
JEEZ: Only halfway through trading day and New Nine bitcoin ETFs have already broken their all time daily volume record w/ $2.6b. We got 4 btc ETFs in Top 20. $IBIT is #4 overall, it’s gonna trade more today than in its first two wks combined. This is officially a craze. pic.twitter.com/Wqez1rKrCg
— Eric Balchunas (@EricBalchunas) February 28, 2024
With the landmark approval of BTC ETFs on January 10, BTC came to Wall Street. It was easily accessible to institutions over-the-counter (OTC) for the first time. The capital inflows from these players catapulted Bitcoin price to scrape $64,000 on Wednesday. A trader and analyst on X, @DaanCrypto, wrote, “Must be one of the craziest runs I’ve seen on Bitcoin throughout my last [seven] years in Crypto.”
Must be one of the craziest runs I’ve seen on #Bitcoin throughout my last 7 years in Crypto.
— Daan Crypto Trades (@DaanCrypto) February 28, 2024
To put it in perspective, Bitcoin price managed to breach four thresholds in a single day, moving past $60,000 to $64,000.
At the time of writing, Bitcoin price is trading for $60,650 after filling the orders of longs when it dipped into the supply zone between $62,905 and $68,212. The level to beat is the midline of this order block at $65,654, beyond which the continuation of the intermediate trend would be confirmed.
BTC/USDT 1-day chart
According to Balchunas, the overflows from the spot BTC ETF market are now spilling into the BTC futures ETF and stock markets.
Bitcoin, altcoins, stablecoins FAQs
Bitcoin is the largest cryptocurrency by market capitalization, a virtual currency designed to serve as money. This form of payment cannot be controlled by any one person, group, or entity, which eliminates the need for third-party participation during financial transactions.
Altcoins are any cryptocurrency apart from Bitcoin, but some also regard Ethereum as a non-altcoin because it is from these two cryptocurrencies that forking happens. If this is true, then Litecoin is the first altcoin, forked from the Bitcoin protocol and, therefore, an “improved” version of it.
Stablecoins are cryptocurrencies designed to have a stable price, with their value backed by a reserve of the asset it represents. To achieve this, the value of any one stablecoin is pegged to a commodity or financial instrument, such as the US Dollar (USD), with its supply regulated by an algorithm or demand. The main goal of stablecoins is to provide an on/off-ramp for investors willing to trade and invest in cryptocurrencies. Stablecoins also allow investors to store value since cryptocurrencies, in general, are subject to volatility.
Bitcoin dominance is the ratio of Bitcoin’s market capitalization to the total market capitalization of all cryptocurrencies combined. It provides a clear picture of Bitcoin’s interest among investors. A high BTC dominance typically happens before and during a bull run, in which investors resort to investing in relatively stable and high market capitalization cryptocurrency like Bitcoin. A drop in BTC dominance usually means that investors are moving their capital and/or profits to altcoins in a quest for higher returns, which usually triggers an explosion of altcoin rallies.