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Bitcoin surged to near $38,000 — a level last seen in May 2022 — powered by an ongoing rally spurred by ETF demand expectations.

The ongoing rally spurred by expectations of regulatory approval for Bitcoin ETFs in the United States has pushed the world's largest cryptocurrency to near $38,000 — a level last seen in May 2022. The world's largest cryptocurrency added about 6% in the Nov 15 trading session.

The solid trading has spread to the ETF world as well. First Trust SkyBridge Crypto Industry & Digital Economy ETF (CRPT - Free Report) and Simplify Bitcoin Strategy PLUS Income ETF (MAXI - Free Report) stole the show, climbing 9% and 8%, respectively, on the day. This was followed by gains of at least 7% each in Blockchain & Bitcoin Strategy ETF (BITS - Free Report), ProShares Bitcoin Strategy ETF (BITO - Free Report), and Bitwise Bitcoin Strategy Optimum Roll ETF (BITC - Free Report).

A combination of factors, including the anticipation of regulatory approvals for Bitcoin ETFs, growing institutional interest and a sustained bullish trend in the cryptocurrency market, has contributed to the increased demand and valuation of bitcoin. The surge has rekindled interest in the crypto market, signaling positive sentiment among both retail and institutional investors.

Though the U.S. Securities and Exchange Commission has delayed its decision on approving the first Bitcoin ETF that directly invests in Bitcoin, Bloomberg Intelligence predicts that a batch of such funds will likely receive approval by January. Such a development would not only legitimize Bitcoin in the eyes of mainstream investors but also provide a more accessible avenue for investment, thereby potentially attracting a fresh influx of capital into the crypto market.

Famed investor and ARK Invest CEO Cathie Wood expects trillions of dollars to flow into spot bitcoin ETFs and the digital-asset industry at large in the next decade. Wood predicts about $20 trillion in the bitcoin market by 2030, pointing to an increase in institutional investment in bitcoin, as well as a wider acceptance of use cases for digital assets by traditional financial firms.

Part of the crypto gains were also attributable to the belief that the Fed is nearing the end of its rate hike cycles, especially after the latest inflation data. Analysts are now betting on no more future rate hikes, which could push the Bitcoin rally all the way to $44,000 before the spot Bitcoin ETF approval.

ETFs in Focus

First Trust SkyBridge Crypto Industry & Digital Economy ETF (CRPT)

First Trust SkyBridge Crypto Industry and Digital Economy ETF is designed to provide exposure to companies that SkyBridge believes are driving cryptocurrency, crypto assets and digital economies-related innovation. SkyBridge identifies securities primarily via “bottom-up” research, focused on finding companies leading in the crypto industry ecosystem. First Trust SkyBridge Crypto Industry holds 30 stocks in its basket and charges 85 bps in fees per year from investors. It has amassed $20.2 million in its asset base and trades in an average daily volume of 20,000 shares.

Simplify Bitcoin Strategy PLUS Income ETF (MAXI)

Simplify Bitcoin Strategy PLUS Income ETF seeks capital gains and income by providing investors with exposure to Bitcoin while simultaneously generating income by selling short-dated put or call spreads on the most liquid global equity indices. It has accumulated $30.9 million in its asset base and charges 97 bps in fees per year from investors. Simplify Bitcoin Strategy PLUS Income ETF trades in an average daily volume of 5,000 shares (read: Bitcoin Up Triple-Digits This Year: ETFs in Focus).

Blockchain & Bitcoin Strategy ETF (BITS)

Blockchain & Bitcoin Strategy ETF is an actively managed fund that seeks to capture the long-term growth potential of the blockchain and digital asset theme. It takes long positions in U.S. listed bitcoin futures contracts and invests, directly and indirectly, in companies positioned to benefit from the increased adoption of blockchain technology. Blockchain & Bitcoin Strategy ETF will not invest directly in Bitcoin. It currently delivers exposure to blockchain companies through other ETFs, including the affiliated Global X Blockchain ETF. Blockchain & Bitcoin Strategy ETF has attracted $14.2 million in its asset base. It charges 65 bps in annual fees and trades in an average daily volume of 2,000 shares.

ProShares Bitcoin Strategy ETF (BITO)

ProShares Bitcoin Strategy ETF invests primarily in bitcoin futures contracts and does not invest directly in bitcoin. It is the world's largest and most actively traded cryptocurrency ETF, with AUM of $1.4 billion and an average trading volume of 9.5 million shares. ProShares Bitcoin Strategy ETF charges 95 bps in annual fees.

Bitwise Bitcoin Strategy Optimum Roll ETF (BITC)

Bitwise Bitcoin Strategy Optimum Roll ETF provides directional exposure to bitcoin via regulated futures contracts and seeks to maximize potential roll returns through a selective analysis of bitcoin futures beyond front- or near-month contracts. The fund does not invest directly in Bitcoin. Bitwise Bitcoin Strategy Optimum Roll ETF has attracted $1.3 million in its asset base. It charges 85 bps in annual fees and trades in an average daily volume of 1,000 shares.

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