NEW YORK, March 11, 2024 — Bitcoin (BTC) reached a new price milestone today, surpassing $72,000 after a strong performance last week that saw it hit two all-time highs. Ether also saw significant gains, climbing above $4,000 in anticipation of the Dencun upgrade, scheduled for Wednesday. This upgrade is expected to reduce transaction fees and improve processing speeds on the Ethereum network.
In related news, two SEC commissioners criticized the current regulatory approach to the crypto industry in the U.S. Additionally, Federal Reserve Chairman Jerome Powell confirmed that there are no immediate plans to introduce a central bank digital currency (CBDC) for the U.S. dollar.
Bitcoin Reaches New Highs Amid ETF Buzz
Bitcoin's recent surge can be attributed to the launch of spot bitcoin ETFs in the U.S. and the forthcoming halving event. Despite experiencing significant drops after each peak, Bitcoin managed to surpass $72,000 on Monday. This rise coincides with the UK's Financial Conduct Authority's decision to permit cryptocurrency exchange-traded notes (ETNs), which has further fueled optimism.
The iShares Bitcoin Trust (IBIT) by BlackRock has become a major player in the bitcoin market, briefly holding more bitcoin than MicroStrategy (MSTR) last week. MicroStrategy recently acquired an additional 12,000 bitcoins, increasing their total holdings to 205,000. Meanwhile, new ETFs have surpassed the Grayscale Bitcoin Trust (GBTC) in size, with GBTC seeing over $10 billion in outflows since transitioning to an ETF format.
Crypto-Related Stocks Soar
MicroStrategy’s investment in bitcoin has significantly boosted its stock, which rose 16% to approximately $1,650 in early trading on Monday. The stock has surged over 600% in the past year and around 140% since the beginning of 2024. According to MicroStrategy's executive chairman Michael Saylor, investing in MicroStrategy offers a tax-efficient way to gain bitcoin exposure with downside protection.
Coinbase (COIN) also benefited from the bitcoin rally, with its stock climbing more than 15% in the past week and roughly 70% year-to-date, despite facing technical issues from high trading volumes.
SEC Commissioners Criticize Crypto Regulation
SEC commissioners Hester Peirce and Mark Uyeda voiced their concerns about the agency's regulatory approach to cryptocurrencies, criticizing the lack of clarity regarding which tokens are considered securities. They argued that the current regulatory environment is stifling innovation and intimidating entrepreneurs.
Peirce and Uyeda's comments reflect broader frustrations from the crypto industry, including companies like Coinbase and Kraken, which have faced legal challenges from the SEC for operating unregistered securities exchanges.
Fed Chairman Powell Addresses CBDC Concerns
In recent Congressional testimony, Federal Reserve Chairman Jerome Powell reassured that there are no current plans for a U.S. CBDC. Powell emphasized that any future digital currency initiatives would work within the existing banking framework and would not pose a direct competition to private banks or intrude on personal financial transactions. His remarks come amidst ongoing legislative efforts to ensure that any CBDC issuance would require Congressional approval, highlighting continued debates over privacy and the implications of central bank digital currencies.