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London (CNN Business) --This year, cryptocurrencies are up. They have gone down. But they never seem to be entirely out of the game.
What's happening: The excitement around bitcoin is building again as a financial tool is expected to debut this week that could increase the cryptocurrency's exposure.
After falling in the spring, bitcoin is now trading above $60,000, not far from its all-time high of over $64,800 reached in April. So far this month it has risen more than 40%.
What's driving the gains: Investors are buzzing about the long-awaited launch of the first bitcoin futures ETF. The launch of the ProShares Bitcoin Strategy ETF is planned for this Tuesday, according to the company. An ETF is an exchange traded fund.
The fund will provide an entry point for investors who are interested in cryptocurrencies but do not want to deal with the buying and selling of the tokens.
The Securities and Exchange Commission (SEC) signaled last week that it might finally approve such an instrument, which the crypto industry has long lobbied for.
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"Before investing in a fund that holds bitcoin futures contracts, make sure you carefully weigh the potential risks and rewards," the agency tweeted.
If approved, the ETF could provide a strong boost to bitcoin's latest rally.
"We view the approval of a bitcoin futures ETF as a positive step for the digital asset space," Isaac Boltansky, director of policy research at BTIG, said in a recent note to clients.
“That doesn't mean regulators are completely abandoning their distrust of cryptocurrencies.” Boltansky noted that a futures ETF is different from an ETF that buys and sells bitcoin directly. In this regard, the SEC appears to remain skeptical.
And the entry into force of stricter regulations is still on the horizon. Oversight agencies face increased pressure to act as investments increase.
In a recent speech, Bank of England official Jon Cunliffe noted that the market crash of $1.2 trillion in subprime mortgage-backed securities triggered the 2008 financial crisis. Crypto securities, meanwhile, already represent $2.3 trillion.
"The $2.3 trillion, of course, needs to be seen in the context of the $250 trillion global financial system," Cunliffe said. "But, as the financial crisis showed us, you don't have to represent a large proportion of the financial sector to trigger financial stability problems."
Some players in the sector are aware of the potential problems. Coinbase published a proposal to regulate digital assets last Thursday. The company, which went public earlier this year, has called for a US body to be appointed to oversee crypto securities.
“When new questions or political challenges arise, the ability of a single dedicated regulatory body to respond in an efficient and timely manner benefits everyone,” Coinbase noted in research.
