Bitcoin surpasses US$71 thousand, Ether jumps 19%; Why are cryptocurrencies rising today?

Cryptocurrencies like Bitcoin and Ether jumped on Tuesday after the US SEC asked exchanges that want to trade ether exchange-traded funds (ETFs) to update regulatory filings. Bitcoin jumped to $71,957 and Ether hit $3,720.80, the highest levels last seen on April 9.

“On Monday, Bitcoin jumped over 6% on international exchanges as $70,000 was breached quite easily by bulls, only to reach the $72,000 resistance after 40 days. This jump, however, was led by ETH, which jumped more than 15% as ETH’s gains overtook BTC in distance after a long time,” CoinSwitch Markets Desk said in a statement.

At 12:42 pm on Tuesday, Bitcoin (BTC) prices were at $71,334.89, which is about 6.5% higher compared to Tuesday. Bitcoin’s current market value is $1,405.39 billion. The 24-hour trading volume is $52.06 billion. Bitcoin is up nearly 6.45% in the last 24 hours with a circulating supply of 19.70 million, according to real-time data from Binance.

Ethereum (ETH) is currently trading at $3,684.90 with a current market cap of $442.66 billion. The 24-hour trading volume is $36.30 billion. Ethereum is up around 19.30 percent in the last 24 hours with a circulating supply of 120.13 million.

Although Bitcoin is the largest and best-known cryptocurrency in the world, Ether is the currency linked to the Ethereum blockchain network.

Why are Bitcoin and Ether rising today?

“The main reason for the increase in ETH can be attributed to the Ethereum ETF deadline, which is May 23rd. While many analysts predicted that it is highly unlikely that an ETH ETF would be approved, the probability of an ETF approval suddenly jumped from 25 per year. percent to 75 percent by Bloomberg analyst Eric Balchunas. This happened when the SEC asked aspiring ETF exchanges to update 19b-4 filings before the May 23 deadline,” according to CoinSwitch Markets Desk.

However, the ETH ETF is still unlikely to be approved this week – the SEC appears to be moving in a positive direction, and that’s what triggered the market, he added.

Announcement

With Ethereum on the move, other common layer 2 protocols built on top of Ethereum have also seen some gains, with ARB and OP leading the pack with gains of over 18 percent versus USDT, CoinSwitch stated.

Increased demand for cryptocurrencies in 2024

Bitcoin prices have regained strength since last October and reached a record high of $73,803.25 in March. Bitcoin is now up more than 82% from its yearly low of $38,505 on Jan. 23.

The approval and launch of spot bitcoin exchange-traded funds in the US this year opened the asset class to new investors and reignited excitement that evaporated when prices fell in the “crypto winter” of 2022.

The world’s largest cryptocurrency has risen 161% over the past two quarters on hopes of an interest rate cut from the US Federal Reserve and optimism surrounding the launch of spot bitcoin exchange-traded funds (ETFs).

Biggest Bitcoin Wallet Password Recovery Requests

Cryptocurrencies exist on a decentralized digital ledger known as a blockchain, and investors can choose to access their assets through a locally stored software wallet or a hardware wallet to avoid risks associated with holding cryptocurrencies on an exchange, such as in the case of the old FTX.

Losing access to a crypto wallet is a well-known problem. Investors forgetting their complex passwords are the main reason, but loss of access to two-factor authentication devices, unexpected cryptocurrency exchange closures, and cyberattacks are also common.

Wallet passwords are usually alphanumeric and the wallet provider also offers a set of random words, known as “seed phrases”, for additional security – both of which are known only to the user. If investors lose passwords and phrases, access to their wallets will be cut off.

According to a Reuters report, password recovery service companies are witnessing an increase in requests.

A Switzerland-based company that uses Nvidia graphics processing unit cards to run artificial intelligence models to access idle wallets saw requests increase tenfold in the first quarter compared to the same period a year ago.

“We have seen an increase (in wallet unlock requests) whenever the price changes drastically,” according to the Reuters report citing a senior company executive who declined to be named.

ReWallet, a Germany-based provider of wallet recovery services, saw a 334% jump in requests in the previous quarter and saw a record number of requests in early March when bitcoin prices reached an all-time high.

The company estimates that about 20% of the total 19 million bitcoins in circulation as of March 13 are likely inactive and are now worth about $237 billion.

US-based wallet recovery services saw a 30% increase in requests this year in mid-April.

Bitcoin Mining in El Salvador

Meanwhile, according to official data, El Salvador has mined nearly 474 bitcoins since 2021 thanks to a volcano-powered geothermal plant, bringing the government’s total bitcoin portfolio to nearly $354 million at current prices.

The country’s ‘Bitcoin Office’, an official government entity, reports that government coffers now hold 5,750 bitcoins.

The new additions, 473.5 bitcoins worth around $29 million since September 2021, were powered by a small amount of geothermal energy generated by the country’s towering Tecapa volcano, touted as a green way to accumulate the well-known cryptocurrency, which is not regulated by any central bank.

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In 2021, El Salvador became the first country to adopt bitcoin as legal tender, alongside the US dollar it adopted two decades earlier. The move away from bitcoin has drawn harsh criticism of Nayib’s government for adopting the volatile cryptocurrency, including from the International Monetary Fund (IMF).

(With contributions from agencies)

Mohammad Haris

Haris is Deputy News Editor (Business) at news18.com. He writes on various subjects

first published: May 21, 2024, 1:03 pm IST

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