Bitcoin (BTC) surged to a two-month high of $28,817 earlier today on renewed optimism that a spot Bitcoin ETF could be approved in the U.S. in the coming months.
The latest rally comes as several major financial institutions, including Fidelity, Ark Invest, and Invesco, have amended their spot Bitcoin ETF filings with the Securities and Exchange Commission (SEC).
These amendments suggest that the SEC is in communication with prospective ETF providers and is actively considering their applications.
Some analysts believe that the approval of a Sport bitcoin ETF could add at least $1 trillion to the overall crypto market capitalization.
This is because spot ETFs would provide investors with a regulated and easy way to gain exposure to Bitcoin, which could attract significant inflows from institutional investors.
In addition to the potential approval of a spot Bitcoin ETF, Bitcoin is also being boosted by increasing volumes and bullish sentiment among traders. Some analysts are now forecasting that Bitcoin could touch $29,400 in the coming days.
Spot Bitcoin ETF could push Bitcoin to $73,000
According to a recent report by data analytics firm CryptoQuant, the approval of a spot Bitcoin ETF could push Bitcoin's price to between $50,000 and $73,000.
This is based on the assumption that ETF issuers would put 1% of their Assets Under Management (AUM) into these ETFs, which would represent almost a third of Bitcoin's current market capitalization.
CryptoQuant also notes that historically, during previous bull markets, Bitcoin's market capitalization has grown 3-5 times more than its realized capitalization.
This suggests that for every $1 of fresh money entering the Bitcoin market, the market capitalization could increase by $3-$5.
Bullish sentiment keeps bears at bay
The recent bullish price action in Bitcoin has also kept bears at bay. According to Markus Thielen, head of research and strategy at Matrixport,
"Nobody will dare to short BTC now for the foreseeable future. Even if this Cointelegraph news was false, BTC can still grind higher in anticipation of the approval." According to Markus Thielen, head of research and strategy at Matrixport.
