Bitcoin surges back above $80,000! Cryptocurrency stocks soar, SEC approval of tokenized stocks acts as a catalyst.

US regulators have been releasing a series of positive signals for the crypto market, leading to a renewed inflow of funds into Bitcoin ETFs. As the market gradually digests previous negative factors such as setbacks in crypto legislation and the Federal Reserve's interest rate hikes, crypto assets saw a collective rise on Friday, with Bitcoin climbing back above the $80,000 mark and cryptocurrency concept stocks also strengthening across the board.

According to CoinMarketCap data, Bitcoin (BTC), the cryptocurrency with the largest market capitalization, accelerated its rise during the European trading session on Friday, breaking through $80,000 for the first time since September 4. In the US midday session, it once again broke through $81,300, hitting a new high since September 4, rising more than $5,000 from the daily low, or more than 6.7%.

Ethereum (ETH), the second-largest cryptocurrency by market capitalization after Bitcoin, surged past $2,640 in midday trading on Friday, hitting its highest level since September 11, up more than 8.5% from its daily low. Besides BTC and ETH, other major assets in the cryptocurrency market also rose, indicating that funds are not solely concentrated in Bitcoin, but rather reflecting a broader recovery in risk appetite.

The surge in cryptocurrencies quickly spread to related US stock assets.

By Friday's close, Coinbase (COIN), the largest cryptocurrency exchange in the United States, rose nearly 11.7%, Strategy (MSTR), a major Bitcoin holder, rose about 16.4%, Circle (CRCL), the first stablecoin listed on the US stock market, rose nearly 7.9%, and Robinhood (HOOD), a popular brokerage firm that supports cryptocurrency trading, rose more than 9.1%.

Cryptocurrency mining stocks also surged, with MARA Holdings (MARA) closing up nearly 13.8%, Bit Digital (BTBT) up nearly 13.1%, Riot Platforms (RIOT) up nearly 8.6%, and Hut 8 (HUT) up over 8.5%.

After Bitcoin broke through $80,000 intraday, cryptocurrency-related stocks such as Coinbase, Strategy, and MARA collectively rose by more than 10% at one point. Looking at the market, the gains in cryptocurrency-related stocks generally exceeded those of Bitcoin itself, reflecting a significant increase in investors' risk appetite for gaining exposure to crypto assets through exchanges, mining companies, and companies holding cryptocurrencies.

Commentary points out that the SEC's permission for qualified platforms to trade tokenized stocks, the CFTC's push for a new crypto regulatory framework, and the return of funds to Bitcoin ETFs are all important factors contributing to improved market sentiment. Previously, the market worried that the CLARITY Act's stalled progress in the Senate this Tuesday would be a new negative factor for crypto assets. However, judging from Friday's market performance, this risk seems to have been partially digested in the previous correction.

SEC's "innovation exemption" opens the door to tokenized stocks

A key catalyst for this surge in the cryptocurrency market was a series of actions taken by US regulators on Thursday.

The U.S. Securities and Exchange Commission (SEC) announced an "Innovation Exemption" on Thursday, October 17th (Eastern Time), granting a temporary, conditional exemption to eligible tokenized securities trading platforms, allowing them to trade tokenized versions of certain U.S. listed stocks on-chain. The SEC stated that this measure aims to promote the development of on-chain trading in the U.S. capital markets.

According to the rules published by the SEC, approved Tokenized Securities Venues (TSVs) can trade tokenized U.S. stocks using licensed automated market makers and liquidity pools, but they must meet a number of conditions, including restrictions on the types and volumes of stocks traded, and giving the issuers of the relevant stocks the opportunity to raise objections.

At the same time, tokenized stocks must grant holders the same rights as traditional securities, including the right to receive dividends and exercise voting rights; synthetic stock tokens that do not have these rights are not covered by this exemption. This exemption is currently a temporary measure and will be valid for five years.

SEC Chairman Paul Atkins stated that this measure is a step by the SEC, within its existing statutory authority, to push the capital markets into the "digital age" after Congress has stalled progress on cryptocurrency legislation.

This is also seen by the market as a positive regulatory signal for the cryptocurrency industry. Commentators believe that the SEC's action provides a regulatory pathway for some platforms to trade tokenized U.S. securities, further strengthening the stock prices of companies like Coinbase.

The CFTC simultaneously loosened restrictions, allowing regulators to proceed through a "circumvention" route.

It is worth noting that the SEC's actions are not an isolated incident.

Also on Thursday, the U.S. Commodity Futures Trading Commission (CFTC) announced a new "no-action" stance for passive software providers. Under certain conditions, CFTC staff will not recommend enforcement action against these software providers for not registering as introducing brokers (IBs). This arrangement applies to software that helps users trade with registered futures commission dealers, introducing brokers, and designated contract markets.

CFTC filings show that this arrangement corresponds to Staff Letter 26-25 issued on September 17, meaning that the regulatory exemptions previously granted to individual companies have been further expanded to eligible passive software providers.

The Wall Street Journal believes that after the landmark CLARITY Act, a bill on the structure of the cryptocurrency market, failed to advance in the U.S. Senate on Tuesday, the SEC and CFTC are using their existing powers to advance regulatory frameworks, temporarily filling some regulatory gaps instead of congressional legislation.

Barron's cited market opinions stating that the obstruction of the CLARITY Act has not completely changed investors' expectations for the direction of US crypto regulation, as the SEC and CFTC can still proceed with rule-making through their respective regulatory authority.

Therefore, what the market is currently trading is not that "crypto regulatory legislation has been implemented," but rather that regulatory agencies are still gradually establishing new regulatory channels for the digital asset industry through administrative and rule-based means.

Bitcoin ETFs see capital inflows, and risk appetite rises in tandem.

In addition to regulatory news, there are also signs of improvement in the funding situation.

The Wall Street Journal, citing data from JPMorgan Chase, reported that on Thursday, a group of Bitcoin ETFs managed by institutions such as BlackRock received a total of approximately $160 million in net inflows, ending two consecutive days of outflows.

After the cryptocurrency market experienced a correction, with Bitcoin falling to a multi-week low, the return of ETF funds and positive signals from regulators provided both financial and sentiment support for Friday's market rebound.

At the same time, the macroeconomic environment also experienced a brief easing.

Some media outlets believe that the decline in Brent crude oil prices, which had earlier approached $110 per barrel, to below $104 on Friday eased inflationary and interest rate pressures previously stemming from rising energy prices. These outlets argue that the drop in oil prices reduced market concerns about further interest rate increases and also benefited a rebound in risk assets such as Bitcoin.

This means that Friday's market movement was not solely driven by positive factors in cryptocurrencies themselves, but rather by a convergence of improvements in regulatory policies, capital flows, and macroeconomic risk appetite.

Following the interest rate hikes by the US and Japan, the market is beginning to reassess "financing costs."

However, whether this rebound in cryptocurrencies can be sustained still faces the test of the macroeconomic policy environment.

Alice Liu, head of research at CoinMarketCap, said that despite recent interest rate hikes by the Federal Reserve and the Bank of Japan, the total market capitalization of the cryptocurrency market has still grown, suggesting that the market may have already partially priced in the policy changes.

She believes that what deserves more attention now is how rising financing costs will affect market positioning.

This is particularly noteworthy. Following the recent interest rate hike by the Federal Reserve, US Treasury yields remain high, implying an increase in the yield of risk-free assets. For crypto assets, which are inherently volatile, higher financing costs and funding prices may limit some leveraged funds from further expanding their positions.

Therefore, Bitcoin's rebound to $80,000 on Friday reflects both the market's rapid response to the improved regulatory environment and the fact that interest rate factors that previously suppressed risk assets have not yet prevented funds from returning to the crypto market.

From a market perspective, there are even signs that funds are spreading further to high-beta crypto stocks: as Bitcoin rose by about 6%, Strategy rose by more than 16%, and mining stocks such as MARA and Bit Digital also rose by nearly double digits, indicating that investors are amplifying their exposure to rising cryptocurrency prices through highly volatile stocks.

However, the SEC's "innovation exemption" is still a temporary and conditional regulatory arrangement, and the CFTC's measures also come with specific conditions. Meanwhile, comprehensive legislation governing the cryptocurrency market structure is still incomplete. Therefore, Friday's market movement more accurately reflects the market's repricing of a temporary improvement in the regulatory environment, rather than the complete implementation of the US cryptocurrency regulatory system.

After a period of adjustment, Bitcoin has broken through $80,000 again, drawing market attention back to a core question: with interest rates still high, can regulatory easing continue to attract new funds to crypto assets?

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