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In October, Bitcoin prices surged by more than 20% due to gains driven by expectations of an ETF

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    Bitcoin prices rallied more than 20% in October. (Photo illustration by Chesnot/Getty Images)

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    Bitcoin prices have climbed more than 20% so far this month, pushing higher as optimism surrounding the long-awaited approval of a spot bitcoin exchange-trade fund (ETF) fueled upside.

    The world’s most prominent digital currency was trading at roughly $34,500 at approximately 10:30 p.m. EST, according to CoinMarketCap data.

    At this point, the cryptocurrency had appreciated close to 23% from the value it had at the start of October, additional CoinMarketCap figures revealed.

    When explaining the strong performance that the digital asset experienced this month, analysts who contributed input for this article pointed out several potential catalysts.

    Spot Bitcoin ETF Hopes

    However, one causal factor that market observers singled out repeatedly was anticipation that the U.S. Securities and Exchange Commission (SEC) will finally “green light” a spot bitcoin ETF.

    The government agency has approved multiple futures-based bitcoin ETFs, but it has yet to consent to the creation of any spot versions of these funds.

    A wide range of sources, including analysts and financial institutions, have predicted that the SEC will soon give one of these proposed ETFs the nod.

    Such a development could prove highly bullish for the digital currency, as it would offer investors easy access through a financial instrument they could buy and sell through a traditional exchange.

    The 2024 Halving

    When outlining the various factors that caused bitcoin’s gains this month, David Schwartz, Director of Projects and Strategic Partnerships for the Litecoin Foundation, emphasized the key role played by the upcoming halving event, offering his perspective through Telegram.

    Roughly every four years, the bitcoin network cuts its mining incentive, which is the reward paid to nodes for helping confirm transactions and incorporate them into blocks in the digital currency’s blockchain.

    Next year, this incentive will be reduced to 3.125 units of bitcoin from the current amount of 6.25 units.

    Historically, bitcoin prices have pushed higher in the months leading up to these halving events.

    A Potential Safe Haven

    One analyst claimed that the digital currency has benefited lately as investors have flocked to it in order to hedge against geopolitical developments.

    “One more catalyst is that BTC, like Gold, has begun acting as a safe haven investment,” Greg Magadini, Director of Derivatives for digital asset data provider Amberdata, said via emailed comments.

    “This has been apparent since the SVB banking crisis in March 2023,” he added.

    “Middle Eastern tensions and the Ukraine/Russia war before it, have both coincided with a rush to safety in Gold and surprisingly BTC,” stated Magadini.

    “This trend has proven itself in 2023 as BTC outperformance has led the crypto sector.”

    Julio Moreno, Head of Research for CryptoQuant, weighed in on this subject via Telegram.

    “At some point this year there was high correlation between bitcoin returns and gold so one could say that,” he stated.

    “However, the correlation has turned negative during the recent month as Bitcoin rallied,” Moreno added.

    Schwartz took a different point of view.

    “I'd like to see how you can prove bitcoin is a safe haven right now,” he stated.

    “For who? I can see gold as there is no other indicator for its rise in price and there are ways for institutions, etc to get their exposure to it.”

    “But for Bitcoin, unless you have people buying it on OTC, I don't see it. I see people holding, sure. And I don't think it was apparent after SVB banking crisis, either.”

    Disclosure: I own some bitcoin, bitcoin cash, litecoin, ether, EOS and sol.


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