Monday Market Minute | Nov 13, 2023

Bitcoin surpasses $35,000 as crypto recovery accelerates on ETF speculation

What Moved

Bitcoin rallied above $35,000 for the first time since May 2022, driven by growing conviction that the SEC would approve one or more spot Bitcoin ETFs in early 2024. BlackRock, Fidelity, and other major asset managers had filed applications, lending institutional credibility to the approval thesis. The rally extended to the broader crypto market, with total market capitalization recovering to levels not seen since the pre-FTX collapse period. Canadian crypto ETFs — already trading on the TSX — saw renewed inflows as the asset class regained sentiment.

Why It Matters

Canada had been ahead of the curve on crypto ETFs, with Purpose, CI, and other managers offering regulated products since 2021. The potential U.S. approval represented a validation of the Canadian regulatory approach and could drive significant capital into an asset class that many institutional investors had abandoned after FTX. For Canadian HNW investors, the question shifted from "should I have crypto exposure" to "how much and through which vehicle." Regulated ETF wrappers removed the custody and counterparty risks that had haunted the space.

Signal to Watch

The SEC's January 2024 deadline for the Ark/21Shares and BlackRock spot Bitcoin ETF applications — approvals would catalyze a new wave of institutional adoption globally.

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