ETF Sees Boost from Bitcoin Surge
Wow, have you heard about the recent Bitcoin boom? Thanks to the U.S. election results, Bitcoin saw a massive surge in November. By the end of November 29, the biggest cryptocurrency was up almost 40% for the month. This is a huge increase, especially when you consider how well Bitcoin has been doing throughout the year so far.
One of the funds benefitting from this rally is the WisdomTree Bitcoin Fund (BTCW). It’s one of the Bitcoin exchange traded funds that launched in the U.S. back in January. The rally in Bitcoin this year has been driven by financial advisors, professional investors, and regular folks who have been getting into these spot ETFs. This surge has pushed BTCW to manage assets worth $363.1 million. That’s quite a feat in just 11 months!
And if Bitcoin continues on this upward trend, BTCW’s value could keep growing as we head into 2025. Especially if Bitcoin manages to break through the $100,000 mark. As of late November 29, Bitcoin was trading at over $97,400, just a bit shy of record highs. But interestingly, the CME-listed Bitcoin futures traded above $100,000 recently. This has led to speculation about when the spot price will follow suit.
Spot prices for Bitcoin are crucial for investors looking into BTCW. This ETF is directly linked to those prices and not to Bitcoin in the futures market. So, every time Bitcoin gets close to hitting $100,000 in the spot market, we see some profit-taking happening. This is normal. If Bitcoin manages to break through that level though, the rally could be significant. This could lift up ETFs like BTCW in the process.
There’s also talk of short covering playing a role in all of this. Right now, investors are likely looking for Bitcoin to push back to $99,000. This price point is important not just because it’s close to $100,000, but also because it’s where some traders might need to cover their bearish futures positions. This short covering could help push the spot price of Bitcoin over $100,000.
It’s definitely an exciting time to be following the Bitcoin market, and it will be interesting to see how things continue to unfold. Stay tuned for more news, information, and analysis on the Modern Alpha Channel!
