December 5, 2023

Bitcoin Price Roars Above $34,000 As Crypto Regains Confidence. Cathie Wood Cashes In.

Cryptocurrency prices rose again Wednesday after soaring Tuesday as bitcoin continues to rally on hopes a spot bitcoin exchange-traded fund will launch soon. Bitcoin price rallied above $35,000 intraday Tuesday – its highest level since May 2022.

Bitcoin led cryptocurrency prices higher over the past two weeks after the SEC declined to challenge its court loss against Grayscale Investments (GBTC) and its effort to convert its Grayscale Bitcoin Trust into a spot bitcoin ETF on Oct. 13.

Late Monday, a U.S. appeals court ordered the SEC to review Grayscale’s ETF application. The regulator could still reject the spot bitcoin application, but it would need a new justification to do so.

Grayscale filed a S-3 form with the SEC on Thursday to register its $18 billion bitcoin trust as a product under the 1933 Securities Act, the Wall Street Journal reported. ARK Invest (ARKK), VanEck, BlackRock (BLK) and Coinbase (COIN) are among the wave of firms that also filed for bitcoin ETFs.

Strong Bitcoin Demand

“Institutional demand for a spot bitcoin ETF is stronger than ever before. For many institutions, it is a matter of when — not if — the SEC will approve a spot bitcoin ETF,” wrote Diogo Monica, co-founder and president of Anchorage Digital, in an email to IBD. Crypto unicorn Anchorage Digital offers full-stack API infrastructure to bring crypto to institutional clients.

A spot bitcoin ETF would provide a regulated and accessible wrapper for bitcoin exposure, and also mark a major vote of institutional confidence in the broader ecosystem, Monica added. SEC approval would also lead to greater demand from RIAs and large asset managers for crypto infrastructure.

The positive sentiment is shared by other major industry players. Coinbase Chief Legal Officer Paul Grewal said he is “quite hopeful these applications will be granted,” during a CNBC interview last week. ARK Invest CEO Cathie Wood expects spot bitcoin ETF approval to occur this year or in early 2024, according to an Oct. 12 podcast interview.

Cathie Wood Cashes In

Meanwhile, Cathie Wood and ARK Invest appear to be using the recent rally to take some profits. ARK Invest on Monday sold a total 42,613 shares of COIN stock from its ARK Next Generation Internet ETF (ARKW) and ARK Fintech Innovation ETF (ARKF) worth $3.29 million based on Coinbase’s 77.21 closing price.

ARK sold 100,739 shares of Grayscale’s Bitcoin Investment Trust from ARKW worth $2.48 million based on the 24.70 GBTC closing price.

The firm sold an additional 21,062 shares of COIN stock from ARKW on Tuesday worth $1.73 million based on the 82.07 closing price, according to daily trade updates. It unloaded 72,509 shares of GBTC from ARKW worth nearly $1.9 million based on the 26.16 closing price.

Bitcoin Price, Related Action

Cryptocurrency prices were largely green Wednesday afternoon. Bitcoin price traded around $34,700 late Wednesday after spiking as high as $35,144 intraday Tuesday. Ethereum traded around $1,790 on Wednesday following its rally to $1,853 Tuesday morning.

GBTC stock rose 2.4% after ballooning 6.2% Tuesday. Coinbase stock bolted 6.3% Tuesday but retreated 5.2% Wednesday.

Bitcoin miner Marathon Digital (MARA) fell 3% Wednesday. MARA stock vaulted 11.5% Tuesday, adding to its 12.8% surge Monday. Riot Platforms (RIOT) ticked lower Wednesday. Shares jumped 10.3% Tuesday after gaining 9% Monday.

MicroStrategy (MSTR) rose 2% Wednesday and spiked 12.5% Tuesday. MSTR stock climbed 8.5% Monday. The computer software company holds 158,245 bitcoin with an average purchase price of $29,582 as of Sept. 24, CoinDesk reported.

MSTR stock is climbing the right side of a possible a cup base.

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