Bitcoin shot past $59,000 and Ethereum hit $3,300 early Wednesday morning, reflecting growing bullish sentiment among crypto traders.
Combined, BTC and ETH now account for $1.5 trillion, or 67% of all digital assets worldwide. Over the past day, global market capitalization rose 3% to $2.3 trillion.
According to CoinGecko data, Bitcoin price, currently $59,266.94, is up 5.4% since this time yesterday and 15% since a week ago.
BTC, the world's largest and oldest cryptocurrency, benefited from strong tailwinds from the nine new spot Bitcoin ETFs that began trading in January. According to CoinGlass, the ETFs, along with other BTC exchange-traded products, had a total volume of $3.8 billion and a market capitalization of just under $45 billion as of early Wednesday morning.
On Tuesday alone, spot Bitcoin ETFs recorded net inflows of $359 million.
Hopes are growing among traders that the impact of April's Bitcoin halving will be amplified by ETFs absorbing more Bitcoin than is released onto the network each day.
Bitcoin halving reduces the rewards paid to Bitcoin miners for validating transactions. In the history of Bitcoin, it has already happened three times in 2012, 2016 and 2020. The block reward was previously 50 BTC but has now been reduced to 6.25 BTC. After this year’s halving – currently scheduled for mid-April – the block reward will be reduced to 3,125 BTC.
It is an anti-inflationary mechanism to reduce the rate at which the 21 billion Bitcoin supply is released to the network. The periodic reminder of scarcity usually triggers a bull market every time it has happened before, but it remains to be seen how things will play out this time.
Meanwhile, Ethereum is getting a boost from anticipation of its Dencun upgrade. The change became even more real yesterday when developers announced that the change will be pushed to the Ethereum mainnet on March 13, 2024.
The upgrade will usher in proto-Dank sharding, making transactions on the network much faster and more affordable.
According to a new report from ByBit, there are also signs that institutions are starting to give Ethereum a larger place in their portfolios.
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