Bitcoin was in sight of $38,000, a level last seen in May 2022, amid an ongoing rally spurred by expectations of fresh demand for the token from exchange-traded funds.

The largest digital asset has added about 6% in the past 24 hours and was trading at $37,843 as of 8:53 a.m. Thursday in Singapore, extending its year-to-date rebound from a 2022 rout to 129%. A range of smaller virtual currencies, such as second-ranked Ether, also pushed higher.

While the Securities and Exchange Commission on Wednesday again deferred a decision on whether to approve the first US ETF investing directly in Bitcoin, Bloomberg Intelligence expects the green light for a batch of such funds by January. The ETFs would make it easier for institutions and mom-and-pop investors to gain exposure to the token.

Bets that the Federal Reserve is done with interest-rate hikes have also lifted crypto prices, which can be sensitive to inflections in the level of liquidity in financial markets.

“The recovery in crypto valuations can continue if real interest rates peak and we continue to see progress toward spot ETF approvals in the US market,” Zach Pandl, managing director of research at crypto fund provider Grayscale Investments LLC, wrote in a note.

One conundrum for investors is whether the climb in Bitcoin this year already discounts the likely impact of spot ETFs.

The approval may be “baked into the price” but the question is how much inflow the ETFs will attract, Sui Chung, chief executive officer of digital-asset index provider CF Benchmarks, said on Bloomberg Television.

Diversification benefits are driving the conversation over Bitcoin investment given the token’s lack of correlation with assets like stocks over longer periods, he said.