Bitcoin nears $100,000 as regulatory optimism and ETF-driven investments push the cryptocurrency to new heights, signaling mainstream acceptance.
Bitcoin surged to a new all-time high on Friday, briefly surpassing $99,000 and edging closer to the $100,000 mark. This record-breaking rally comes amid optimism about a more crypto-friendly environment under the incoming Donald Trump administration. The cryptocurrency’s remarkable growth has sparked discussions about its mainstream acceptance and regulatory future.
Bitcoin’s Soaring Momentum
Bitcoin’s value has more than doubled in 2023, climbing approximately 130% this year alone. Since Trump’s electoral victory on November 5, Bitcoin has surged by 45%, fueled by expectations of favorable policies and the rise of pro-crypto lawmakers in Congress.
After touching $99,000, Bitcoin slightly dipped but held strong at $98,500, marking a 0.5% daily increase. Despite the minor pullback, the cryptocurrency remains poised for its third consecutive week of over 10% gains, potentially achieving its best monthly performance since February.
The Role of Regulation and Mainstream Acceptance
Bitcoin’s meteoric rise has cemented its position as a cornerstone of so-called “Trump trades,” investments expected to benefit from the administration’s policies.
Sixteen years after its creation, Bitcoin is gaining broader recognition. Shane Oliver, Chief Economist at AMP Sydney, commented, “The longer Bitcoin survives, the more seriously it’s being taken. While valuing Bitcoin remains complex, its current momentum is undeniable.”
President-elect Trump has signaled strong support for digital assets, pledging to establish a national Bitcoin stockpile and position the United States as the “crypto capital of the planet.” Crypto investors are particularly optimistic about reduced scrutiny from the Securities and Exchange Commission (SEC), following reports that SEC Chairman Gary Gensler will step down in January.
Under Gensler, the SEC pursued legal action against major crypto exchanges such as Coinbase, Kraken, and Binance for operating without proper registration. These companies have denied the allegations and are actively defending themselves in court.
ETF Approvals: A Game-Changer
The introduction of U.S.-listed Bitcoin exchange-traded funds (ETFs) in January has been a pivotal factor in Bitcoin’s 2023 growth. Previously resisted by the SEC, these ETFs have made it significantly easier for institutional investors to access Bitcoin, attracting over $4 billion in investments since Trump’s election victory.
The momentum has also benefited crypto-related stocks. MicroStrategy, a company heavily invested in Bitcoin, saw its shares rise by 2.6% in premarket trading on Friday. By 11:25 GMT, trading volume for MicroStrategy shares exceeded that of tech giants like Nvidia, Tesla, and Apple, with $645 million worth of shares traded, according to Refinitiv LSEG data.
Outlook for Bitcoin and the Crypto Market
As Bitcoin approaches the $100,000 milestone, analysts remain optimistic about its potential to sustain this growth. The combination of regulatory optimism, ETF adoption, and increasing institutional interest signals a promising future for the cryptocurrency market.
However, questions remain about the long-term implications of reduced regulatory scrutiny and the potential risks of overexposure to speculative assets. Market participants will be closely watching the early days of the Trump administration to gauge the broader impact on the crypto industry.
Bitcoin’s unprecedented rise highlights its growing relevance in global financial markets. With favorable policy changes on the horizon and increasing mainstream adoption, the cryptocurrency appears set to play an even larger role in the global economy.