Bitcoin prices continued to expand their gains during the Asian market on Tuesday as investors became increasingly excited about the prospect of approval of a Bitcoin-based spot ETF. As of press time, Bitcoin has risen more than 14% to its highest point in more than a year at $34,659.8.The U.S. Securities and Exchange Commission (SEC) will not challenge a ruling in favor of cryptocurrency investment group Grayscale Investments that wrongfully rejected its application for a Bitcoin ETF, according to reports. Cryptocurrency markets received a boost as a result.


Bitcoin's surge also sent cryptocurrency-related stocks higher, as speculation about the approval of a Bitcoin ETF fueled enthusiasm for the sector and prompted short sellers to exit their positions. Coinbase Global (COIN.US), Marathon Digital (MARA.US), and MicroStrategy (MSTR.US) all closed sharply higher on Monday and rose further during after-hours trading.

Ethereum, the smaller digital currency by market capitalization, rose nearly 8% to hit a two-month high and break above its 200-day moving average.

Matthew Dibb, chief information officer of crypto asset management company Astronaut Capital, said: "The market is doing its best to run ahead of the approval of the spot Bitcoin ETF, and the consensus is that this will happen sometime in the next three months, if not earlier."

It is reported that BlackRock, VanEck, Wisdom Tree, Fidelity, Bitwise and Invesco have all submitted applications for Bitcoin ETFs. Earlier, Bloomberg Intelligence ETF analyst Eric Balchunas revealed that BlackRock’s iShares Bitcoin Trust has been filed with the DTCC, triggering the latest round of speculation that the ETF is about to be approved.

DTCC and BlackRock did not immediately respond to requests for comment. Last week, BlackRock denied an erroneous report that the ETF was approved, and sources close to the SEC confirmed that the application is still pending. The SEC did not immediately respond to a request for comment.

Dibb also pointed out that data from cryptocurrency derivatives analysis platform Coinglass showed that Bitcoin short positions were liquidated significantly in the past 24 hours.

At the same time, concerns that the conflict between Israel and the Islamist group Hamas could turn into a regional conflict are also spreading in the wider market.

Zach Pandl, managing director of research at Grayscale Investments, said: "We have seen recent geopolitical tensions drive demand for scarce assets, including physical gold and Bitcoin, which many investors view as digital gold."