FirstFT: Bitcoin surges on hopes for ETF approval

By News Room On Jan 2, 2024

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Bitcoin has surged to its highest level since April 2022 amid speculation that the US Securities and Exchange Commission will soon grant regulatory approval for exchange traded funds tied to the cryptocurrency’s spot price.

The world’s largest cryptocurrency bitcoin rose to $45,817 today, bringing its total gains since the beginning of October to 69 per cent.

Supporters of the digital currency are hoping recent prosecutions in the industry will draw a line under the sector’s troubled past and clear the way for institutional money to become involved in a more meaningful way.

BlackRock, Fidelity, WisdomTree and Invesco are among issuers hoping to introduce bitcoin-linked ETFs this year. Here’s the latest on the bitcoin moves.

Here’s what else I’ll be watching today.

Markets: The S&P 500 closed up 24 per cent last year, ending 2023 just shy of its record high. Futures contracts suggest the index will open higher later today in New York. Follow the FT’s live blog for the latest on markets.
Tesla: The electric-car maker releases 2023 production figures. Chinese rival BYD yesterday took a step closer to unseating Tesla as the world’s top-selling electric-vehicle manufacturer.
Economic data: S&P Global publishes manufacturing purchasing managers’ indices for the eurozone, UK, US, Canada and Mexico today.
European Union: Belgium takes over the EU’s revolving presidency, while the bloc marks the 25th anniversary of the launch of the euro.
G7: Italy begins its 12-month presidency of the economic group.

Read our special edition of the Week Ahead newsletter for key moments in the diary for the year ahead.

Five more top stories

1. A total of 367 passengers and 12 crew have been evacuated from a Japan Airlines aircraft after it caught fire at Tokyo’s Haneda airport, according to the airline. Live images of the plane, which was flying from Sapporo in Hokkaido to the Japanese capital, appeared to show flames erupting from the aircraft shortly after it skidded down. The accident happened as the death toll from the New Year’s Day earthquake rose to 48. The government has dispatched 10,000 of its military forces to help rescue and relief efforts. Here’s the latest on the quake.

2. The leader of South Korea’s leftwing opposition has been stabbed in the neck, throwing the country’s politics into flux ahead of parliamentary elections in April. Lee Jae-myung, who was defeated by conservative Yoon Suk Yeol by a margin of less than 1 per cent in the last presidential election in 2022, was attacked as he visited the site of a proposed airport in the southern port city of Busan. Read the latest on Lee, who is reportedly conscious and receiving treatment in a Seoul hospital.

3. Spanish renewables group Iberdrola has called off its planned $8bn acquisition of PNM Resources, cancelling a deal that would have transformed its Avangrid subsidiary into one of the biggest companies in the US utilities sector. The deal had already been rejected by a New Mexico court and there were other appeals pending. The decision will force a rethink of Iberdrola’s plans in the US.

4. The private equity industry has entered 2024 with record amounts of unspent investor cash and an unprecedented stockpile of ageing deals that firms must sell in the coming years. Private equity firms were sitting on a record $2.59tn in cash reserves available for buyouts and other investments as of December 15, according to S&P Global Market Intelligence. Here’s more on the industry, which executives say faces a big test this year.

5. BlackRock’s lead in the US exchange traded fund market is being eroded by Vanguard and smaller rivals as firms jockey for a larger slice of the $8tn industry. BlackRock’s iShares managed about 32 per cent of the US ETF market as of November. That compared with 33.7 per cent in late 2022 and was down more than 7 percentage points from the end of 2018. Read the full story.

The Big Read

Artificial intelligence was last year’s big story in the technology industry, with companies racing to build generative AI systems. This year will bring the acid test of whether it is ready for widespread adoption. FT reporters consider this and other trends affecting businesses in 2024.

We’re also reading . . .

Big Four: Scandals and strategic mis-steps exposed shortcomings in governance at the top accounting and consulting firms last year, prompting a rethink about how best to hold management to account.
‘Zoomers’ vs ‘doomers’: Technological optimists often berate those who needlessly slow down progress by worrying about harms, writes John Thornhill. Who will prove to be right when it comes to AI?
Israel-Hamas war: What will be left of Gaza when the war ends? The infrastructure and economy of the enclave have been shattered, and Gazans displaced by the conflict fear there will be nothing to return to.

Chart of the day

Billions of dollars of debt will fall due this year on hundreds of big US office buildings that their owners are likely to struggle to refinance at current interest rates. There are $117bn of commercial mortgages tied to offices which either need to be repaid or refinanced in 2024, according to data from the Mortgage Bankers Association.

Take a break from the news

From a vision of civil war in a near-future US to a blockbuster Van Gogh exhibition at the National Gallery in London, here is the FT’s selection of films, theatre, art and music to look forward to in 2024.

Additional reporting by Tee Zhuo in Singapore

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