Bitcoin News Today: Bitcoin Nears $120,000 Again as El Salvador Opens Bitcoin Banks

Bitcoin’s price has surged past $118,000, drawing attention to its potential to reach the $120,000 level once again, fueled by tightening supply conditions and major developments in El Salvador. The country has taken a bold step by passing a new Investment Banking Law that allows regulated investment banks to hold Bitcoin and other digital assets on their balance sheets [1]. These institutions, distinct from traditional commercial banks, will cater exclusively to sophisticated investors and must hold at least $50 million in starting capital. The move aims to attract foreign investment and establish El Salvador as a hub for crypto finance [1].

The government’s initiative is part of a broader strategy to deepen the country’s integration with digital assets. This follows the 2021 adoption of Bitcoin as legal tender under President Nayib Bukele’s leadership [2]. Now, with the new regulatory framework, banks may operate as Bitcoin-focused entities, offering a fresh avenue for institutional exposure to the cryptocurrency [1]. However, critics argue that the benefits of these developments may largely favor wealthy institutions over the general population [1].

Meanwhile, institutional adoption of Bitcoin continues to gain momentum, with Harvard University recently allocating $116.6 million into BlackRock’s IBIT spot Bitcoin ETF [3]. This move positions Bitcoin as the fifth-largest holding in the university’s equity portfolio, behind major tech firms such as Microsoft and Amazon [3]. The investment aligns with a broader trend, as U.S. spot Bitcoin ETFs have attracted more than $54 billion in inflows since their launch in early 2024 [3].

These developments have contributed to a bullish sentiment in the market. Bitcoin has gained approximately 4% in the past seven days, currently trading near $118,320 [3]. Analysts are watching closely to see whether the price will break through the $120,000 psychological level or consolidate in the coming weeks [4]. Some forecasts suggest a potential pullback toward $108,000 before another attempt at a new high [5].

El Salvador continues to build its Bitcoin reserves, recently adding 7 BTC in a single week to reach a total of 6,258.18 BTC [6]. The government views this as part of a long-term strategy to reduce reliance on remittance fees from the U.S. and strengthen financial independence [6].

Despite the optimism, not all countries are moving at the same pace. Japan, for example, has yet to approve a spot Bitcoin ETF, despite multiple reports of applications. SBI Holdings, one of the leading players in Japan’s crypto market, has clarified that it has not yet submitted any official applications for crypto ETFs [1]. However, the firm has indicated plans to launch crypto-asset-linked investment trusts and ETFs once regulatory approvals are secured [1].

El Salvador’s experiments with Bitcoin continue to attract global attention. Recent high-profile engagements, including a forum featuring representatives from Tether and Blockstream, signal ongoing international interest in the country’s crypto vision [7]. Additionally, the potential for U.S. interest rate cuts by year-end, as hinted by the Federal Reserve, has further encouraged bullish positioning among investors [8].

While the trajectory of Bitcoin’s price and El Salvador’s crypto ambitions remain uncertain, the developments highlight a growing acceptance of digital assets in both institutional and national financial frameworks. Whether this serves as a model for global adoption or a cautionary tale will depend on how these initiatives unfold in the coming months.

Sources:

[1] https://www.newsbtc.com/news/bitcoin/bitcoin-nears-120000-again-as-el-salvador-opens-bitcoin-banks/

[2] https://www.bloomberg.com/news/articles/el-salvador-adopts-bitcoin-as-legal-tender-under-bukele/

[3] https://www.wsj.com/articles/harvard-university-invests-116-6m-in-blackrocks-bitcoin-etf-11644867841

[4] https://www.bitcoin.com/news/bitcoin-price-analysis-nears-120000-again/

[5] https://coindesk.com/analysis/bitcoin-price-analysis-bulls-eye-120000

[6] https://www.coindesk.com/el-salvador-adds-7-btc-to-national-reserves/

[7] https://www.newsbtc.com/news/el-salvador-hosts-crypto-forum-with-tether-and-blockstream/

[8] https://www.reuters.com/business/finance/fed-signal-stirs-hopes-for-late-2024-rate-cuts-2024-10-10/