The price of bitcoin was hovering above the US$45,000 mark at the time of this writing. Cryptocurrencies have regained some momentum in August after suffering some sharp losses in the late spring and early summer. There has been considerable debate among policymakers over the future of crypto and whether it should be embraced by the mainstream.
Thus far, crypto enthusiasts have reason for optimism. For months, the sector worried that regulators were preparing to enact another crackdown. Instead, policymakers have moved to the acceptance stage. That said, there are other headwinds that are a concern for the fledgling sector right now.
Markets have been shaky in recent weeks as there is increased anxiety about the rise of the Delta variant. There are concerns that a resurgence in COVID-19 cases around the world could torpedo the recovering economy. Digital currencies have suffered in the face of these conditions.
The Purpose Bitcoin ETF (TSX:BTCC.B) was the first bitcoin-focused exchange-traded fund (ETF) to be launched on a major market. Its shares have fallen over 10% since its debut. However, shares of the ETF have climbed 48% month over month. The fund has a management fee of 1%, which may strike investors as being on the higher end. However, this gives you the opportunity to own bitcoin directly in a registered account.
I’m bullish on bitcoin as it has recaptured momentum in recent weeks. Inflationary pressure and economic uncertainty should push investors into the arms of this alternative asset rather than scaring them away in 2021.
