Bitcoin Touches Six-Week High; Ether Futures ETFs Begin Trading

(Bloomberg) — Bitcoin touched a six-week high before paring gains, while the first-ever US exchange-traded funds based on Ether futures began to trade.

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Smaller peers including Ether, Litecoin and Solana were also initially higher before turning negative. The volatility comes as traders await the trial of Sam Bankman-Fried, founder of bankrupt crypto exchange FTX, which is scheduled to begin Tuesday.

“There appears to have been significant buying flows, possibly driven by the start of a new accounting quarter, and the resulting moves were exacerbated by scarce week-end liquidity,” said Caroline Mauron, co-founder of digital-asset derivatives liquidity provider OrBit Markets in Singapore.

Mauron said she expects Bitcoin to keep advancing in October, with $30,000 seen as the next major resistance level. The last time Bitcoin fell in the month of October was during the 2018 bear market, data compiled by Bloomberg show.

Bitcoin rose as much as 5.4% to $28,576, the highest level since Aug. 17. It was up 2.6% as of 3:19 p.m. in New York. The token climbed 4.1% in September, but still dropped 11% last quarter.

Inflows to exchanges of stablecoins on the Ethereum blockchain has turned positive since Sept. 28 — an indicator that traders are lining up funds to buy digital tokens, according to data provider Nansen.

“We’ve seen increased BTC buying, especially on Coinbase, since Sept. 28, suggesting institutional demand is rising,” said Dessislava Ianeva, a senior researcher at Kaiko. “This has spilled into altcoins” like Solana and Polygon.

The initial rally appears to have been helped by speculation the US Securities and Exchange Commission will eventually approve BlackRock Inc.’s proposed Bitcoin exchange-traded fund, even though the regulator deferred the decision last week, said Hayden Hughes, co-founder of social-trading platform Alpha Impact.

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ProShares, VanEck and Bitwise, among others, debuted Ether futures funds on Monday.

The launches come almost exactly two years after Bitcoin-futures ETFs premiered in the US to much fanfare and a rapid gathering of assets for the first such product, the ProShares Bitcoin Strategy ETF (ticker BITO). Yet that launch happened at the height of the crypto boom, when Bitcoin, the largest virtual currency, trader above $60,000. The race for dominance and assets this time around could be more challenging as crypto prices wither and investor interest in the once-hot space remains nearly extinguished.

Ether fell less than 1% to around $1,660, after jumping as much as 4.6% earlier.

–With assistance from Tanzeel Akhtar and Reinie Booysen.

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