Bitcoin prices regained their foothold above the $50,000 mark for the first time in more than two years
Tencent Technology News reported on February 13 that according to foreign media reports, thanks to the record debut of the Bitcoin spot ETF, the price of Bitcoin broke through the $50,000 mark on Monday. This is also the first time in more than two years that the price of bitcoin has stood above $50,000.
Bitcoin has been in a bull market since January last year, and some investors who missed out on opportunities may have developed a "fear of missing out" (FOMO). When the Bitcoin spot ETF began trading on January 11, the price briefly exceeded $49,000 that day, but then plummeted to a minimum of $38,500 in the following days.
While the new spot ETF traded billions of dollars in the first few weeks of trading, investors' attention seems to be focused on the Grayscale Bitcoin Trust (GBTC), which has transitioned from a closed-end structure to an ETF. In the weeks leading up to the opening of spot ETF trading, the Grayscale Bitcoin Trust saw billions of dollars in outflows. Since then, the outflows from the Grayscale Bitcoin Trust have gradually decreased, while large amounts of money continue to flow into new products.
On February 8, the Grayscale Bitcoin Trust sold only 1,850 bitcoins, while nine other ETFs added nearly 11,000 bitcoin tokens. On February 9, the Grayscale Bitcoin Trust sold 2,252 bitcoins, while the other nine ETFs continued to grow by more than 13,000. In the long run, only 900 newly mined bitcoins enter the market every day (this number will soon drop to 450 per day when bitcoin production halved in April).
The price of Bitcoin peaked in November 2021, when it reached about $69,000. 2022 was a disaster due to the implosion of the Terra ecosystem and the announcement in November 2022 by Sam Bankman-Fried, the prodigy founder of the crypto exchange FTX, that more than 130 FTX group entities, including FTX, U.S. subsidiary FTX.us, and Alameda Research, had voluntarily filed for Chapter 11 bankruptcy under the U.S. Bankruptcy Code.
The price of Bitcoin ended 2022 at just over $16,000, down about 75% from its peak. Many other crypto tokens suffered even greater losses. In addition to falling prices and big-name business closures, layoffs and closures across the industry are also common – a trend that continues throughout 2023.
Although 2023 is seen as a bull market for cryptocurrencies, Bitcoin's price action has been quite weak for most of the year. On October 1, 2023, the price of Bitcoin was around $27,000, an increase of more than 65% from the beginning of the year. But considering Bitcoin's price level, this is a relatively small recovery.
By the fourth quarter of 2023, there was growing belief that the SEC would finally give the green light to Bitcoin spot ETFs in early 2024. Years earlier, the SEC had delayed and categorically rejected any attempt by asset managers to launch a Bitcoin spot ETF. The price of Bitcoin rose by almost 60% in the fourth quarter of 2023, ending at around $42,000. (Compilation/Mowgli)