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Bitcoin reaches $50,000 for the first time since 2021, driven by increased demand for ETFs

Crypto World News
Bitcoin's resurgence persists, with the leading cryptocurrency hitting the $50,000 mark on Monday (Feb. 12). This milestone represents the first time bitcoin has reached such a value since December 2021, signaling a recovery for a digital asset that experienced a 64% decline in 2022.
The recent upswing is attributed to the Securities and Exchange Commission's approval of exchange-traded funds (ETFs) for bitcoin in January. This development is expected to contribute to broader mainstream acceptance of cryptocurrency, according to a Bloomberg report.
Market analysts, such as Matt Maley, chief market strategist at Miller Tabak, highlight discussions around increased capital inflow into bitcoin and growing enthusiasm among momentum players.
Simultaneously, investors in the broader financial landscape are re-embracing risk, anticipating that the Federal Reserve will adopt a more lenient monetary policy. With higher interest rates making riskier assets like cryptocurrencies less appealing, the market dynamics are shifting.
Contrary to the past year's tumultuous events in the crypto sector, a recent PYMNTS report suggests that the crypto landscape in 2024 might be deemed "boring." Bitcoin ETFs have gained regulatory approval, leading some players in the market to rebrand from "cryptocurrency" to the more conservative "cryptofinance."
The report acknowledges positive developments, noting the exposure of fraudulent elements like Sam Bankman-Fried and bubble-prone scam coins. Despite these revelations, crypto prices have rebounded, and the overall market valuation of the digital asset industry has approximately doubled over the past year.
However, the report also highlights caveats, quoting SEC Chairman Gary Gensler's cautionary note. Gensler emphasized that while the SEC is merit-neutral, bitcoin remains a speculative and volatile asset, frequently associated with illicit activities. The ETF approval does not imply the SEC's endorsement of bitcoin, and investors are advised to remain vigilant about the associated risks. This nuanced perspective challenges the optimistic view held by some crypto enthusiasts regarding the role of cryptofinance in the financial ecosystem, as noted by PYMNTS.

February 13, 2024