Bitcoin soared to a record high on Friday, edging closer to the $100,000 milestone, Reuters news report said.
The cryptocurrency’s rally this year has been fueled by optimism over favorable regulatory conditions under the incoming Donald Trump administration. Bitcoin’s value has more than doubled in 2024, climbing approximately 45 percent since Donald Trump’s decisive election victory on November 5, which also ushered in several pro-crypto lawmakers into Congress.
deVere Group’s Nigel Green predicted over a month ago that Bitcoin would hit $100,000 following Donald Trump’s re-election.
“I believe Bitcoin could reach $120,000 in the first quarter of 2025 as the rally gains further traction,” Nigel Green said.
Bitcoin’s recent growth can be attributed to a combination of factors that have heightened market optimism and investor confidence in the cryptocurrency. Here are the key drivers behind its surge:
Regulatory Optimism
The election of Donald Trump as the 47th President of the United States and the arrival of pro-crypto lawmakers, there is anticipation of a more favorable regulatory environment for cryptocurrencies. Trump’s promise to make the U.S. the “crypto capital of the planet” and the expected departure of SEC Chair Gary Gensler, who oversaw significant scrutiny of crypto companies, have boosted market sentiment.
Institutional Acceptance
The approval of U.S.-listed Bitcoin Exchange-Traded Funds (ETFs) has made it easier for institutional and retail investors to gain exposure to Bitcoin. Over $4 billion has flowed into these ETFs since the election, indicating strong demand.
Mainstream Recognition
As Bitcoin approaches its 16th anniversary, its longevity has enhanced its credibility. Investors and economists now take it more seriously, seeing its survival as evidence of resilience.
Momentum and Speculation
Bitcoin’s price has been on a sharp upward trajectory, with gains of around 130 percent this year. Such momentum has a self-reinforcing effect, attracting more traders and investors looking to capitalize on the rally.
Macroeconomic and Policy Factors
Bitcoin has benefited as part of the “Trump trades” narrative, where assets expected to thrive under Republican policies have surged. Additionally, Trump’s proposed accumulation of a national Bitcoin stockpile has fueled speculation of increased adoption and demand.
Market Sentiment Shift
After a prolonged bear market, the approval of ETFs and reduced regulatory pressure have significantly improved market sentiment. Bitcoin’s three consecutive weeks of over 10 percent gains underscore strong investor confidence.
These elements combined make Bitcoin’s growth not just a reflection of speculative interest but also a sign of its broader acceptance in financial markets. However, as always, volatility remains a hallmark of the cryptocurrency market, and risks persist alongside opportunities.
Baburajan Kizhakedath
