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Bitcoin Receives Major Investor Attention Amidst New Highs for 2023

Bitcoin (BTC) remains the top target for institutional investors in the past two weeks as the market continues its uphill form this year.

A new report from CoinShares shows Bitcoin’s investment products have attracted $310 million in inflows over 14 days amid skepticism over the approval of the spot BTC ETF by the Securities and Exchange Commission (SEC).

According to the report, BTC leads the pack as it recovers from the previous nine weeks of consecutive outflows.

While this week’s inflows amounted to $123 million, short-BTC investment products recorded $0.9 million in outflows dragging its negative run to the 10th straight week.

Bitcoin dominance can be seen as its share in the last two weeks makes up 98% of the entire market,

the second time this year leaving no room for a bearish sentiment with its price trading above $31,000 at press time.

Ethereum led the altcoin pack inflows of $2.7 million while blockchain equities recorded inflows of $6.8 million, the first time in nine weeks.

Other altcoins like Ripple (XRP), Cardano (ADA), and Polygon (MATIC) recorded similar positive figures with Solana (SOL) posting $0.8 million.

what are the reasons for the recent surge in Bitcoin investment products

Bitcoin’s recent surge in investment products can be attributed to several factors, including:

  • Rising inflation: With the inflation of the US dollar on the rise, investors are looking for safe-haven assets, and BTC is seen as a hedge against inflation.
  • Interest rates: Markets expect that central bank hikes to the cost of credit are nearing their peak, and such a scenario is set to buoy risk-on assets such as bitcoin.
  • Flight to safety: Investors are fearful of the ongoing traditional finance challenges and are seeking safety in Bitcoin-related products.
  • Growing acceptance: As actors begin to understand the role which U.S. monetary policy, inflation, and increases in interest rates have played in the current banking sector challenges, there is a move towards Bitcoin.

Moreover, the recent announcements from high profile ETP issuers that have filed for physically backed ETFs with the U.S. Securities & Exchange Commission have also contributed to the renewed positive sentiment towards Bitcoin.

how have BTC investment products adapted to recent regulatory changes

Bitcoin investment products have adapted to recent regulatory changes in several ways, including:

  • Compliance with existing regulations: Many Bitcoin investment products have been designed to comply with existing regulations, such as anti-money laundering (AML) and know-your-customer (KYC) regulations.
  • Increased transparency: Some Bitcoin investment products have increased transparency to provide investors with more information about their holdings and operations.
  • Collaboration with regulators: Some Bitcoin investment product providers have collaborated with regulators to ensure that their products comply with regulations and to provide feedback on regulatory proposals.
  • Development of new products: Some BTC investment product providers have developed new products, such as Bitcoin futures and options, that are subject to regulatory oversight.
  • Adapting to evolving regulatory frameworks: As the regulatory framework for crypto assets evolves, BTC investment product providers are adapting to new regulations and guidelines.

It is important to note that the regulatory landscape for Bitcoin investment products is still evolving,

and providers will need to continue to adapt to new regulations and guidelines as they emerge.

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