Bitcoin (BTC-USD) has achieved another historic milestone, continuing its extraordinary recovery after a prolonged crypto winter that began two years ago. Early on December 16, 2024, Bitcoin surged past $106,000 for the first time, marking a 53% increase since the presidential election.
The cryptocurrency’s ascent this year has been remarkable. In March 2024, Bitcoin crossed the $70,000 threshold for the first time, driven by the SEC’s approval of spot Bitcoin exchange-traded funds (ETFs). These ETFs simplify Bitcoin investment through standard brokerage or retirement accounts, making the digital asset more accessible to a wider audience.
Another surge came in July, when Bitcoin once again hit $70,000, coinciding with the debut of the first Ethereum ETFs, which had gained SEC approval earlier in the year.
Why the Buzz Around Bitcoin ETFs?
The approval of spot Bitcoin ETFs has been a game-changer for the cryptocurrency market. Unlike futures-based ETFs, spot ETFs directly own the underlying asset — such as Bitcoin, gold, or silver — offering investors exposure that closely mirrors the asset’s market price.
“There haven’t been ETFs like this before,” said Ric Edelman, founder of the Digital Assets Council of Financial Professionals. He pointed out that while ETFs tied to crypto-related companies and futures contracts have existed, these new spot ETFs directly hold Bitcoin, representing a significant evolution.
The SEC’s decision in January 2024 to approve nearly a dozen spot Bitcoin ETFs followed a pivotal court ruling in 2023. A federal appeals court determined that the SEC had wrongfully denied Grayscale Investments’ application to convert its Bitcoin Trust into a spot ETF. Choosing not to appeal this ruling, the SEC subsequently approved these ETFs, opening doors for investors seeking regulated exposure to Bitcoin without navigating crypto exchanges or worrying about storage and security.
“The new spot Bitcoin ETFs are viewed as the safest option from a custody perspective,” Edelman explained. “They are regulated by the SEC, and the safeguarding of Bitcoin is managed for you.”
A Mainstream Milestone
As Bitcoin continues to shatter records and find its way into mainstream investment portfolios, one question remains: Is this the moment to invest? Experts urge caution, highlighting that while spot Bitcoin ETFs have lowered barriers, cryptocurrency remains a highly volatile asset class.
For many, the SEC’s approval of these ETFs marks a turning point in the broader adoption and trust in digital assets, setting the stage for a new era in crypto investing.