Bitcoin and other cryptocurrencies were mostly rising Tuesday. However, there are signs that investor interest is moving away from
Bitcoin
and toward other digital currencies following approval of exchange-traded funds tied to spot trading of the largest cryptocurrency.
Bitcoin
has risen 0.5% over the last 24 hours to $42,874. The largest cryptocurrency largely has settled back into its trading range of $42,000 to $44,000 established before the Securities and Exchange Commission approved the first Bitcoin spot ETFs last week. The SEC approval briefly sent Bitcoin above $49,000.
“Investors seized profits on positions initiated at lower BTC price levels and began reallocating capital to altcoins, as evidenced by the decline in dominance over the past week. This pattern is a common occurrence and does not signify a failure in the ETF launch,” wrote Fineqia International analyst Matteo Greco in a research note.
The net inflows into the Bitcoin ETFs in the initial days of trading totaled around $800 million, according to Greco. The focus of the market likely will now turn to the potential approval of ETFs tied to other cryptocurrencies such as Ether, the second largest cryptocurrency.
The focus for Bitcoin, meanwhile, will now be on the expected “halving” in April. Roughly every four years, the reward for mining Bitcoin via solving cryptographic puzzles that serve to validate transactions gets cut in half —a process that helps to limit token supply and arguably drive up prices.
Beyond Bitcoin,
Ether
was up 0.5% at $2.528. Among smaller cryptocurrencies,
Solana
was up 2.2% but
Cardano
was down 0.7%.
Dogecoin
was up 0.4%.
Write to Adam Clark at [email protected]
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