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  • Crypto Week: El Salvador Crypto Profit, BTC above $73,000, while ETF-ETH Chances are Fading

Crypto Week: El Salvador Crypto Profit, BTC above $73,000, while ETF-ETH Chances are Fading

Bitcoin (BTC) is experiencing a 6.4% increase this week, reaching $73,753, marking a new all-time high in the last three days. Such rapid upward momentum can be intimidating, but not for everyone. The ProShares Bitcoin Strategy ETF (BITO) saw capital inflows of $165.3 million, its second-largest result since its inception.

Spot Bitcoin-ETFs also report net capital inflows. The IShares Bitcoin Trust (IBIT) by BlackRock received $2 billion in capital inflows last week, following $1.9 billion the previous week. The second-largest Fidelity Wise Origin Bitcoin Fund (FBTC) saw $1.3 billion in inflows in the first week of March, its largest in history. However, some ETFs were less fortunate. The Grayscale Bitcoin Trust (GBTC) lost $1.8 billion during the week, despite overall net capital inflows of $2.7 billion in the crypto market, with over $2.6 billion invested in Bitcoin. As a result, Bitcoin has become the world’s eighth-largest asset by market cap.

El Salvador has reported a 69.0% gain from its crypto investments, having been the first country to introduce Bitcoin as legal tender in 2021. This move may inspire other countries with weak national currencies to follow suit. Furthermore, improving the crypto legal framework in the United States could facilitate the adoption process.

However, Bloomberg has reduced the likelihood of spot Ethereum ETF approval by the U.S. Securities and Exchange Commission (SEC) in May. The agency's silence, with no typical pre-approval activities seen during the spot BTC-ETF approval process in October-December 2023, has led Bloomberg to estimate the odds of spot ETH-ETF approval in May at 30%, down from 70% in January. Approval expectations were a major driver of the 73% rise in BTC prices and 79% rise in Ethereum since the start of February. This rally is now being challenged by the SEC's silence. Investors are wary of such concerning signals, and any indication from the SEC that approval may be delayed could reverse the rally downwards.

Bitcoin is currently trading above the resistance at $68,000-70,000 per coin. From a technical standpoint, this indicates extreme overbought tension. However, prices may continue to rise to $78,000-80,000.