After days of tiptoeing up to $100,000, Bitcoin finally surpassed the six-figure threshold and then some, rocketing to more than $102,000 in early Thursday trading. The cryptocurrency has been on a torrid rise following the U.S. presidential election in early November, which saw Donald Trump getting the nod again. Trump is widely perceived to be friendly to the crypto industry.
As recently as Nov. 5, Bitcoin was trading below $70,000, but since then it’s skyrocketed, before zooming past the psychologically symbolic $100,000 level. That marks a sharp reversal for the crypto, which had traded below $20,000 back in late 2022, after soaring interest rates and various frauds had dampened traders’ enthusiasm for the digital asset.
With this move higher, the total value of existing bitcoins has swollen to more than $2 trillion.
Trump administration is crypto-friendly
Now the Trump administration promises to be crypto-friendly, paving the way for broader institutional adoption of cryptocurrency and perhaps much more.
“This price appreciation is driven by the perception of an incoming crypto-friendly administration resulting from Donald Trump’s election victory, as well as an increase in accessibility to digital assets for investors via the introduction of new exchange-traded products and greater regulatory clarity globally,” says Pascal St-Jean, CEO of 3iQ, a global digital asset investment manager.
Trump has selected Paul Atkins, a lobbyist and former commissioner of the Securities and Exchange Commission (SEC), to head up the SEC. Atkins is seen as a pro-crypto selection and is co-chair of Token Alliance, a cryptocurrency lobbying organization. Atkins would replace current SEC chief Gary Gensler, who will step down on January 20, 2025. Gensler cracked down on crypto fraud during his tenure.
Other potential initiatives mark the Trump administration as crypto-friendly. On the campaign trail, Trump mentioned establishing a national stockpile of bitcoins. The incoming administration has also been discussing creating a role at the White House to direct a Bitcoin policy.
“Investors expect a Trump administration to push for a much friendlier regulatory framework than the one that currently exists,” says David Morrison, senior market analyst at Trade Nation, a fintech and financial services provider.
Other factors driving Bitcoin’s price higher
It’s more than just a pro-crypto president-elect that’s driving Bitcoin and other crypto prices higher in 2024, however. The price of Bitcoin had been on a strong run before the election.
This year has seen the emergence of Bitcoin ETFs and Ethereum ETFs, both of which hold actual digital assets and allow traders to track cryptocurrencies without holding them directly. These funds have helped spur broader investment in these cryptocurrencies because they’re easy to access on a traditional stock exchange and charge low fees.
The advent of options trading on Bitcoin ETFs has also sparked further wagers on the crypto, and fund managers have quickly rolled out trading products that add even more leverage (and risk) to Bitcoin trading.
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