The price of Bitcoin (BTC) rose above the $31,000 mark on October 23, reaching a near 4-month high last seen when the price was at $31,800. This surge in price has attracted the attention of analysts and investors, who are excited about potential developments that could lead to the launch of a spot Bitcoin ETF.
A tweet from Scott Johnsson caught the attention of the cryptocurrency community. He pointed out two noteworthy details from the latest iShares (Blackrock) S-1 amendment. Firstly, BlackRock has obtained a CUSIP in preparation for the launch of an ETF. Secondly, they may be looking to seed the ETF with cash this month, which is earlier than expected. This disclosure could be seen as another step towards launching the ETF.
However, Bloomberg Senior ETF analyst Eric Balchunas urged caution and advised not to get overly excited about the news. He explained that the amended iShares S-1 document indicates that BlackRock is preparing to seed their ETF, and disclosing this information is just part of the process. Seeding an ETF involves providing initial funding, typically by a bank or broker dealer, to purchase a few creation units (in this case, bitcoin) in exchange for ETF shares that can be traded on the open market from day one.
The surge in Bitcoin’s price through the $30,000 zone can be attributed to increased spot volume. Data from CoinMetrics also shows a rise in weekly inflows from institutional investors into digital asset investment products. CoinShares analyst David Butterfill stated that digital asset investment products received inflows for the fourth consecutive week, totaling $66 million. This recent price appreciation has led to a 15% increase in total assets under management since early September, reaching almost $33 billion, the highest point since mid-August.
Another indicator of bullish sentiment in the market is the doubling of volumes for CME futures. This suggests that both spot and futures traders have a positive outlook on Bitcoin’s recent price action. The increase in CME volumes, in contrast to the Binance futures open interest, indicates that this week’s move may have been influenced by more than just retail traders engaging in leveraged trading.
From a technical analysis perspective, Bitcoin’s 20-day moving average has slightly crossed above the 200-day moving average, which is considered a positive development. However, traders are eagerly awaiting the golden cross, where the 50-day moving average moves above the 200-day moving average, which is seen as a significant bullish signal.
In terms of Bitcoin’s market structure on a longer timeframe, consecutive daily closes above the $31,700 level would be notable as it would place the price above a key pivot point and enter territory that has not been seen since May 2022.
It is important to note that this article does not provide investment advice or recommendations. Cryptocurrency investments involve risk, and readers are advised to conduct their own research before making any decisions.