17 Jan COTW: Bitcoin Spot ETF
- Bitcoin, the first and most well-known cryptocurrency, has a rich and complex history. Bitcoin was created by an individual or group using the pseudonym Satoshi Nakamoto. The concept was introduced in a 2008 white paper titled “Bitcoin: A Peer-to-Peer Electronic Cash System.” For the first few years, bitcoin was primarily a niche interest for cryptography enthusiasts, with little to no monetary value.
- Bitcoin’s value skyrocketed in late 2017, reaching nearly $20,000 before falling sharply. This period was marked by a surge in public interest, with widespread media coverage and increasing investment from both retail and institutional investors. The COVID-19 pandemic initially caused a sharp decline in bitcoin’s price. However, it quickly rebounded and reached new highs, driven partly by institutional investment and the perception of bitcoin as a ‘digital gold’ and a hedge against inflation.
- The most recent phase in bitcoin’s history includes significant regulatory developments. In particular, the U.S. Securities and Exchange Commission’s (SEC) approval of bitcoin spot Exchange-Traded Funds (ETFs) on January 10 marks a major milestone. This approval is seen as a sign of growing mainstream and institutional acceptance of bitcoin.
- While bitcoin initially declined following the SEC approval, what the longer-term impact on the historically volatile cryptocurrency’s price will be remains to be seen.
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