The introduction of the ProShares Bitcoin futures ETF, according to JPMorgan, is unlikely to result in a spike in Bitcoin prices. Instead, they cited inflation as a major factor that may have aided in the rise of Bitcoin prices to new all-time peaks.
Market observers said the latest price shift in Bitcoin was prompted by investors’ abrupt shift away from Gold ETFs and toward Bitcoin funds.
Investors can watch the value of Bitcoin futures and trade on standard markets rather than spot assets with Bitcoin Futures ETFs. These allow traders and investors to have a taste of Bitcoin without having to deal with cryptocurrency exchanges.
Fed saw prices dropping
The U.S. Federal Reserve had previously stated that the current inflation was more of a transitory phase in various announcements.
The Fed had predicted that prices would eventually fall, but given the current status of the economy, which shows no signs of improvement, investors were left with little choice but to look for alternatives that would ensure consistent returns.
In September, Fed Chairman Jerome Powell indicated that the current inflationary situation is “frustrating” and forecast that the current economic crisis will go until 2022, which is longer than he had anticipated.
Gold took the beating
As a result, gold prices took a significant hit, piquing investors’ interest in Bitcoin, which was gaining traction at the time. “The trend away from gold ETFs towards Bitcoin funds has picked up steam,” the Fed said.
Bitcoin prices soared beyond $67,000 earlier this week after the debut of the Proshares Bitcoin Futures ETF, shattering all prior records.
Within the first two days of trading, the exchange-traded fund — which monitors the prices of Bitcoin futures — had surpassed $1.1 billion in trading volume.
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