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- Bitcoin notched a new 2023 high Thursday, jumping 4.5% in 24 hours and hovering near $37,200.
- The cryptocurrency has gained 134% in the last 12 months, and it's up 122% year-to-date.
- Optimism continues to build around a spot bitcoin ETF, and CoinDesk noted a short squeeze in early trading Thursday.
Bitcoin, the world's largest cryptocurrency by market capitalization, reached its highest price in 2023 on Thursday.
The token hovered at $37,200 in early trading, up 4.4% in 24 hours to trade at a new 18-month high. The crypto has gained roughly 122% this year and 134% in the last 12 months.
The rally follows months of start-stop momentum surrounding the Securities and Exchange Commission's talks with financial firms over the potential approval of spot bitcoin ETFs. Late Wednesday, reports emerged that the regulator had opened fresh talks on the matter with Grayscale, a digital asset company that recently secured a legal victory against the SEC in its attempt to convert its Grayscale Bitcoin Trust into an ETF.
Strategists at Bloomberg Intelligence forecasted a 90% chance of approval for a spot ETF in the US by January.
Excitement over a spot ETF has been building all year, and applicants from fund management giants like BlackRock are waiting in the queue for approval by the SEC.
Meanwhile, CoinDesk reported Thursday that a four-hour period in early Asian trading hours showed short-sellers liquidating nearly $50 million in bitcoin positions, sparking a "short squeeze" that helped the day's rally gain steam.
Also helping to drive the price higher is a low supply of bitcoin currently on the market. The supply of bitcoin in circulation is extremely low, according to Glassnode, with long-term investors holding onto their stash as the wait for prices to rise further. One figure suggests the amount of held bitcoin in wallets with minimal spending history recently hit a record of over 15.4 million.
Further out on the horizon, bitcoin's so-called "halving" event is expected to occur sometime in the middle 2024, which some industry veterans have said could eventually push the token's price above $100,000. "Halving" in crypto happens when the number of bitcoins rewarded to miners is cut in half.
Each of the prior three halvings were followed by new all-time highs within 12 months.