Bitcoin traders who had enjoyed a bullish rally earlier this week started taking profits on Thursday, thus forcing a market pullback, but a sudden reversal of trading volumes was caused by news reports about the future of two applications for cryptocurrency exchange-traded funds (ETFs). According to an article published by Bloomberg after the bell rang on Wall Street, regulators at the United States Securities and Exchange Commission seem to be ready to approve two Bitcoin ETFs, and this update had significant repercussions on the market.

Just when it looked like Bitcoin was heading towards the $55K trading level, the Bloomberg report reversed the sentiment, and BTC/USD started trading closer to $57K. The two ETFs in question would be managed by Invesco and ProShares, two respected names on Wall Street. These ETFs are not Bitcoin investment funds per se; they are based on the trading and pricing of BTC futures contracts, but they would be listed on Wall Street just as if they were equity securities. This development is likely to attract a lot of mainstream capital, leading to increased demand for Bitcoin and a higher market cap.

Bitcoin ETFs will be a major innovation on Wall Street. Many experts are predicting that ETFs could increase liquidity, decrease transaction costs, and lead to huge profits for the companies providing them. So what is an ETF, and how is it different from a traditional investment fund? An ETF is a publicly traded investment fund that tracks an index or a certain asset. ETFs are listed on Wall Street just as any other company. So an ETF is very similar to a traditional investment fund or even a stock, with the exception that it is an index that has the ability to track many assets. This means that if an ETF company has an index it wants to track, the fund will buy and sell securities in order to track it closely.

An ETF can also track different assets than its benchmark. This can be beneficial for investors, as they can profit from a combination of currencies or commodities and assets that are not necessarily available in a single fund.