In a historic move one year ago today, the Securities and Exchange Commission (SEC) under the leadership of Gary Gensler finally gave the green light for the trading of spot bitcoin exchange traded funds (ETF). This decision was a game changer for the industry, as it paved the way for the approval of various ETFs that would go on to become the best performing ETFs in history. BlackRock’s ETF $IBIT led the charge, attracting over $52 billion in inflows alone.
Looking back on the past year, it is clear that the approval of these ETFs was a turning point for Bitcoin. The six major events that unfolded in 2024 were all influenced by this decision:
1. Spot Bitcoin ETF approval by the SEC
2. Donald Trump pledging to embrace Bitcoin
3. Corporate adoption of Bitcoin by companies like MicroStrategy
4. Bitcoin reaching the $100,000 price milestone
5. Gary Gensler resigning from the SEC
6. The halving event
The filing of BlackRock’s ETF in the midst of a bear market marked the beginning of a new bull market for Bitcoin. The approval of these ETFs led to a surge in the price of Bitcoin, attracting the attention of institutional investors and setting the stage for further adoption.
With the backing of major asset managers like BlackRock and Fidelity, Bitcoin gained credibility and mainstream acceptance. This, in turn, prompted Donald Trump to publicly support Bitcoin, signaling a shift in the government’s stance towards the cryptocurrency.
The increase in Bitcoin’s price and institutional adoption encouraged companies like MicroStrategy to ramp up their Bitcoin purchases. MicroStrategy’s success in leveraging Bitcoin as a treasury reserve asset inspired other corporations to follow suit, further driving up demand for the cryptocurrency.
The halving event, which reduced the production of new Bitcoin by half, combined with the overwhelming demand for the limited supply of Bitcoin, pushed the price to new all-time highs. On some days, the buying demand far exceeded the amount of new Bitcoin being mined, underscoring the scarcity of the asset.
The success of the ETFs and the changing political landscape in favor of Bitcoin spelled trouble for anti-Bitcoin regulators and politicians. Gary Gensler’s departure from the SEC, along with the resignation of the commissioners who opposed the ETF approval, signaled a shift towards a more Bitcoin-friendly environment in the United States.
In conclusion, the approval of the ETFs was a pivotal moment for Bitcoin in 2024, setting off a chain of events that propelled the cryptocurrency to new heights. Without this approval, the industry may have faced a different fate. The future looks bright for Bitcoin in the US, as it continues to gain legitimacy and acceptance in the mainstream financial world.