- Bitcoin reverses after $45k
- ETF approval speculation
- Risks cautioned by regulators
The value of the cryptocurrency Bitcoin reversed course one day after surpassing $45,000 for the first time in almost two years.
As it hit $41,000, the digital coin plummeted as much as 9%, reminding investors of the risks of cryptocurrency betting.
Excited about a legislative breakthrough, Bitcoin fell one day after reaching $45,000 for the first price since April 2022.
There is increasing speculation that in the coming days, the US Securities and Exchange Commission (SEC) will grant approval for the inaugural exchange-traded funds (ETFs) that are linked to cryptocurrencies.
That would boost the industry’s reputation, especially since SEC Chairman Gary Gensler called it the “Wild West.”
Analysts have cautioned, however, that Bitcoin’s value will plummet if the ETFs are not approved.
Neil Wilson, chief market analyst at Markets, speculated that the recent rise in Bitcoin’s value could be attributed to “enthusiasm and hype surrounding something that everyone has assumed must have value.”
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In 2021, Bitcoin reached an all-time high of approximately $70,000, from a value of less than $500 five years prior.
It subsequently fell below $16,000 in 2022 before exhibiting a resurgence last year.
Regulators in the UK warn investors who buy crypto assets like Bitcoin that capital loss is high.
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