Worldsfeed Tech Desk: Cryptocurrency markets broke the monotony in October with substantial price surges, and Bitcoin (BTC) stole the show, experiencing its most robust monthly rally since January. This surge, driven by the prevailing optimism about potential Bitcoin ETF approvals in the United States, pushed BTC up by over 27%, reaching a 17-month high of $35,000. After maintaining a range around $27,000 in the first half of the month, Bitcoin found stability just above $34,000 in anticipation of the Federal Reserve’s interest rate decision. Investors generally expected interest rates to remain unchanged.
The bullish momentum wasn’t confined to Bitcoin alone. The CoinDesk Market Index (CMI), which monitors a diverse assortment of tokens, recorded a 22% advance in October. Cryptocurrency’s overall market capitalization increased by almost 19%, reaching $1.255 trillion, marking the most significant wealth gain in the crypto market since January’s 33% surge.
The potential approval of Bitcoin ETFs is a game-changer because they offer an easier entry point for the average investor compared to directly purchasing cryptocurrencies or existing investment products like the Grayscale Bitcoin Trust (GBTC), which manages assets worth $21 billion. The United States Securities and Exchange Commission (SEC) initially rejected the conversion of GBTC into an ETF, but legal challenges have weakened this decision, increasing the likelihood of SEC approval and possibly opening the door for ETF applications from institutions like BlackRock, the world’s largest asset manager.
Although October’s crypto rally encompassed a wide range of assets, not all sectors enjoyed equal benefits. The CoinDesk DeFi Index (DCF), representing tokens related to the decentralized finance sector, including decentralized exchanges, lending, and staking protocols, recorded a modest 7% gain in October. Key DeFi tokens like curve (CRV), maker (MKR), uniswap (UNI), and compound (COMP) faced declines ranging from 3% to 7%. Ethereum’s ether (ETH) posted a relatively modest gain of 7%. During this period, ETH’s valuation relative to BTC reached levels last seen in June 2022, which preceded ETH’s superior performance.
On the other hand, the CoinDesk Computing Sector (CPU), an index that tracks protocols focused on constructing and supporting Web3 infrastructure and distributed computing, witnessed an impressive 32% surge in October. Among alternative cryptocurrencies, Solana (SOL) stood out with a remarkable monthly return of over 70%, primarily due to increased network activity and receding concerns about FTX offloading tokens in a fire-sale.