Bitcoin rang in 2024 with its price above $45,000 for the first time since April 2022.

As Reuters noted in a report Tuesday (Jan. 2), the world’s largest cryptocurrency has seen its fortunes rise as investors hold out hope for the approval of exchange-traded spot bitcoin funds (ETFs). Bitcoin hit a 21-month high of $45,922, with the coin up 156% in 2023 in what was its best year since 2020. 

“We expect a positive approval and I won’t be surprised if after the approval, we see a retracement of lower price levels before we go up again,” Matteo Greco, analyst at digital asset company Fineqia International, told Reuters.

He added that the greenlight for a spot bitcoin ETF would “open the door to cohorts of investors that are out of this market at the moment and will definitely improve the liquidity of the market.”

The report adds that increasing confidence that central banks will lower interest rates this year has also helped the crypto market recover from industry black marks like the collapse of FTX and other crypto companies in 2022.

In addition, Markus Thielen, founder of digital asset research firm 10x Research, told Reuters that the crypto markets could also benefit from this year’s presidential election, something that happened in 2021, 2016 and 2020.

The news follows reports from last month about the rising interest in crypto in anticipation of bitcoin ETF approval by the U.S. Securities and Exchange Commission (SEC).

Mathew McDermott, Goldman Sachs’ global head of digital assets, told Reuters in a separate report that he has seen a “huge appetite” for digital assets over the past year.

Crypto advocates have argued that the SEC’s approval of ETFs would represent a victory for the industry in its ongoing conflict with the regulator, and mark a softening of the government’s attitude toward digital currencies.

They also argue that the SEC approval will bring new investors into the crypto space, as they flock to put money into ETFs. 

However, a recent report by JPMorgan analysts questions that argument, saying it’s more likely that existing funds will move from current bitcoin products into ETFs rather than new capital flowing into crypto. 

And while the SEC has suffered some recent court defeats, “it is far from clear that the regulatory tightening of the crypto industry will lessen significantly going forward given how unregulated this industry is,” the report said.

“U.S. crypto industry regulations are still pending and we do not believe U.S. lawmakers would shift their stance…especially with the memories from the FTX fraud still fresh,” the bank added.