Bitcoin has rebounded above the $67,000 mark after experiencing a price plunge following the digital asset’s ascent to a new all-time high on Tuesday. The recovery comes as BlackRock’s iShares Bitcoin ETF (IBIT) bought bitcoin’s brief dip, taking in over $778 million worth of bitcoin on Tuesday. BlackRock’s total inflows into bitcoin via its exchange-traded fund (ETF) have now surpassed the $9 billion mark.
The US Securities and Exchange Commission (SEC) approved the first US-listed ETFs to track bitcoin (BTC-USD) in January. A spot bitcoin ETF is a financial product that investors anticipate could open the gateway for mainstream capital to flood the crypto market. Currently, the indications are favorable, with fund managers such as BlackRock (BLK) and Franklin Templeton (BEN) increasing their allocations into the digital asset.
In the past 24 hours, the largest digital asset by market capitalization has traded flat, changing hands for $66,675, as of the time of writing. This influx of capital from the traditional finance sphere into spot bitcoin ETFs is acting as a major price catalyst for the digital asset, but it is not the only one. The consensus among analysts is that the upcoming ‘bitcoin halving’ could continue to drive inflows into the bitcoin market.
The bitcoin halving is an event that happens about every four years and is expected to happen again this April. The halving will reduce the bitcoin reward that miners receive for validating blocks on the blockchain from the current 6.25 BTC to 3.125 BTC. This could act as a supply crunch for the digital asset, potentially leading to a price appreciation.
Overall, the recovery of bitcoin after the price plunge demonstrates the resilience of the digital asset in the face of market fluctuations. With the approval of US-listed ETFs to track bitcoin and the anticipation surrounding the upcoming bitcoin halving, the future looks promising for bitcoin investors. As more traditional finance institutions increase their allocations into the digital asset, the mainstream adoption of bitcoin continues to grow, paving the way for further price appreciation and market expansion.
