On Monday, the United Kingdom’s financial regulator announced that they are considering allowing the trading of cryptocurrency-backed Exchange Traded Notes (cETNs). This could lead to a surge in prices as early as the 2nd quarter. As a result, the prices of spot Bitcoin ETFs and related stocks rose significantly.
Meanwhile, MicroStrategy (MSTR) continues to invest in Bitcoin, with their recent purchase of 12,000 bitcoins for $821.71 million. This was made possible by a recent offering and excess cash.
The UK’s Financial Conduct Authority (FCA) stated that they will allow the creation of a UK listed market segment for cETNs, as long as all necessary controls and protections are in place. They also reiterated their stance that cETNs and crypto derivatives are not suitable for retail investors due to their high risk and lack of regulation.
The London Stock Exchange also announced that they will accept applications for Bitcoin and Ethereum ETNs in the second quarter of 2024.
These developments open the door for more institutional adoption of cryptocurrencies. The recent launch of Bitcoin spot ETFs in the US in November 2021 has already led to a surge in prices.
Speaking of prices, Bitcoin reached a new record high of $72,386 on Monday, surpassing its previous high of $70,000. Ethereum also saw a significant increase, reaching $4,066, its highest level in over 26 months.
In the stock market, the new Bitcoin ETFs have already seen a 4% increase, with BlackRock (BLK) and ARK Invest’s ARK 21Shares Bitcoin ETFs (ARKB) leading the pack. Coinbase (COIN) also saw a 4% increase in its stock price, while Marathon Digital (MARA) and CleanSpark (CLSK) saw gains of 2.5% and 5% respectively.
For updates on stock news and cryptocurrency prices, follow Harrison Miller on Twitter @IBD_Harrison. And for more helpful tips on investing, check out IBD Live, Top Chart Reading and Trading Techniques, and the IBD ETF Market Strategy.
