According to Bloomberg, the United States is reasserting its dominance in the cryptocurrency markets. This resurgence is evident in the record-breaking Bitcoin Exchange-Traded Funds (ETFs) and a more accommodating regulatory environment. The US dollar, which had lost its position as the most-traded currency against cryptocurrencies to the South Korean won in the first quarter, accounted for over 50% of global volumes in early May.
This is a significant shift from last year when trading volumes moved to Asia due to a series of enforcement actions by US regulators. The current administration holds a slight lead over the previous one in terms of cryptocurrency regulation. The likelihood of the Financial Innovation and Technology for the 21st Century Act becoming law in 2025 is increasing, according to Bloomberg Intelligence.
The political climate began to favor cryptocurrencies on January 11, with the introduction of spot-Bitcoin ETFs. The percentage of cumulative Bitcoin trading volume in the hour before US markets close has risen to 7.2% this year, up from 4.9% during the 2021 crypto bull run. This increase is likely due to Bitcoin ETFs, which calculate their net asset value against benchmarks at that time, promoting arbitrage and price discovery.
Recently, Hong Kong has launched its own set of spot-crypto ETFs tracking both Bitcoin and Ether, the second largest token. Some US investors have managed to profit from the recent market fluctuations. The article concludes by noting that the US is once again becoming a major player in the global cryptocurrency market.