Monday saw Bitcoin reach a record high of almost $71,000, as the biggest cryptocurrency's rise continued unabated.
After announcing on Monday that it will now allow reputable investment exchanges to introduce cryptocurrency-backed exchange-traded notes, the British Financial Watchdog became the most recent regulator to open the door for digital asset trading products.
In European trading, Bitcoin increased by 4.8% to a record $71,677, increasing its gains for the year to 70%. The world's most valuable cryptocurrency has experienced a surge in value due to expectations that the Federal Reserve would soon lower interest rates and a rush of money into recently launched spot bitcoin exchange-traded funds.
According to LSEG statistics, capital flows into the top ten U.S. spot bitcoin exchange-traded funds decreased to a two-week low in the week preceding March 8 but remained close to $2 billion.
According to DailyFX strategist Nick Cawley, "Bitcoin has started the week with a surge, dragging the rest of the cryptocurrency space higher with it."
The supply of bitcoin, which has a 21 million token cap, will become more scarce in April during the so-called halving event.
The rate at which new supply is added to the market and the amount paid to cryptocurrency miners is cut in half every four years, which helps to keep the price stable.
"News also out earlier that the LSE plans to accept applications for bitcoin and ethereum ETNs in Q2 may have also helped today’s push higher," Cawley stated.
The Financial Conduct Authority (FCA), the UK regulator, stated in a statement that these products would only be accessible to professional investors, such as investment firms and credit institutions authorized to operate in financial markets.
Exchange-traded notes (ETNs) for cryptocurrency, which are bonds issued by financial institutions that track the performance of underlying assets, have been warned by the FCA to be harmful to individual investors.
Still, the investment community as a whole is seeing an increase in demand.
