Immediate Impact of Bitcoin ETF Approval on the Crypto Market
Following the approval of Bitcoin exchange-traded funds, Bitcoin made headlines worldwide, but what was the immediate impact on the crypto market?
The immediate effects of the Bitcoin (BTC) ETF approval were not as clear-cut as expected. After the United States announced its approval, Bitcoin trading volume surged from just under $40 billion to over 62%. This sudden increase in trading volume led to a rise in Bitcoin’s market cap from $890 billion to $910 billion.
The overall market cap of the crypto industry also experienced a spike, reaching $1.84 trillion before settling back to $1.77 trillion. However, approximately $7 billion entered and left the market within a few hours.
The surge in trading volume was also reflected in the overall crypto market, which saw a 63% increase in trading volume, rising from $86 billion to nearly $140 billion.
Despite the initial excitement, Bitcoin dominance in the crypto market experienced a brief spike from 50.4% to 50.8%, but quickly fell back to its current value of 49.4%. This drop can be attributed to investors shifting their focus to more volatile altcoins in search of greater opportunities.
Hot Take: The Immediate Impact is Positive but Uncertain
The immediate impact of the Bitcoin ETF approval on the crypto market was positive in terms of increased trading volume and market cap. However, the volatility and short-term capital influx indicate uncertainty and potential risks associated with this development. It remains to be seen how the long-term effects will unfold and whether the approval of Bitcoin ETFs will have a lasting positive impact on the crypto market.
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