On Valentine's Day, investors expressed their love for all things cryptocurrency by trading — dramatically, in many cases — the prices of digital currencies and tokens, as well as securities of companies linked to digital money.
Leading altcoins Ethereum (ETH 6.21%) It was a beneficiary of that, rising 5.4% in late afternoon trading. While this gain was impressive, it did not hold a candle to the cryptocurrency mining equipment specialist Canaan (Can 31.79%), whose American depositary receipts (ADRs) closed the day up nearly 32%. Behind Canaan is a miner Terawolf (Wolf 12.33%) It rose by more than 12%.
Bitcoin effect
Bitcoin (BTC 4.91%) It is the world's first cryptocurrency, and a decade and a half after its introduction, it is still the most influential currency of all time. When they perform well, other currencies and tokens, as well as cryptocurrency mining companies, often tend to decline.
Fortunately for holders of these assets, Bitcoin was the best on Wednesday. After a bit of a slump on Tuesday, it jumped back to the $50,000 level, settling comfortably at the $52,000 level late in the day. The influx of investment into Bitcoin exchange-traded funds (ETFs) shows no sign of abating, and what's good for those securities is great for their underlying assets.
There are other factors that keep the buying fire burning. On Wednesday morning, online cryptocurrency news site Coindesk.com reported that European Union (EU) officials have drafted and distributed a document about the upcoming meeting of the EU Financial Services Commission. The event, scheduled for April, will concern the regulation of cryptocurrencies in the 27-nation economic bloc.
According to Coindesk, the paper outlines the discussion points for the meeting. These include topics such as licensing and implementation of the recently enacted set of markets in cryptoassets laws. Even more interesting is the reference to the digital euro; This is supposed to be the “official” cryptocurrency at the European Union level.
A spot of optimism
The EU document is just the latest in a series of indicators that top regulators around the world are not only taking cryptocurrencies seriously, but also accepting these assets to be part of the fabric of their economies. As these assets become more accepted and established, we could also see markets like Europe adopting the latest crypto innovations.
Which leads to the question: Are spot cryptocurrency ETFs about to start developing overseas as well?
I think it's more than likely. There is a curiosity and thirst for cryptocurrencies all over the world, yet the main stumbling block remains the software and technical knowledge needed to simply transact with coins and tokens. At a glance, spot ETFs remove this requirement, because they are securities that are easily traded on exchanges. We are only at the beginning of the cryptocurrency ETF revolution.
Eric Volkmann has positions in Bitcoin and Ethereum. The Motley Fool has positions in and recommends Bitcoin and Ethereum. The Motley Fool has a disclosure policy.
