Cryptocurrencies Surge as Bitcoin Exceeds $102,000
Jan 6, 2025
Bitcoin Soars to New Heights Amid Trump’s Pro-Crypto Remarks
A cartoon image of US President-elect Donald Trump holding a Bitcoin token marks the cryptocurrency's rise past $100,000 displayed at a Coinhero store in Hong Kong. (Image: Getty)
Bitcoin soared to a record high, crossing $106,000 on Monday. This surge followed comments made by President-elect Donald Trump, who indicated plans to establish a US bitcoin strategic reserve, similar to the existing strategic oil reserves. This announcement has excited many investors in the cryptocurrency space.
The world's leading cryptocurrency reached a peak of $106,533 before settling at around $104,462, reflecting a 3.2% increase. In addition, ether, another prominent cryptocurrency, rose by 1.5%, reaching $3,965.
"We’re in blue sky territory here," stated Tony Sycamore, an analyst at IG. "The next target for the market is $110,000. The pullbacks investors expected didn't materialize due to this new development."
Investor enthusiasm was further bolstered by MicroStrategy's inclusion in the tech-heavy Nasdaq 100 index, which is anticipated to attract more investments towards the software firm that has heavily invested in Bitcoin.
The growing spotlight on cryptocurrencies is largely attributed to the expectation that Trump’s administration may foster a more favorable regulatory environment for digital currencies. Bitcoin's value has surged by an impressive 192% this year alone.
According to data from CoinGecko, governments globally held approximately 2.2% of Bitcoin's total supply as of July, with the United States owning nearly 200,000 bitcoins, valued at over $20 billion at current prices. Other countries such as China, the UK, Bhutan, and El Salvador have also accumulated significant amounts of Bitcoin.
Many nations are actively considering establishing cryptocurrency strategic reserves. Russian President Vladimir Putin commented earlier this month on how the current US administration undermines the US dollar's position as the global reserve currency by utilizing it for political purposes. He remarked, "No one can prohibit Bitcoin; it is an asset that many are now considering."
However, caution remains among some experts. Federal Reserve Chair Jerome Powell compared Bitcoin to gold earlier this month, indicating skepticism around its mainstream acceptance. Analysts remind investors that implementing a strategic reserve would require time and careful planning. Chris Weston, head of research at Pepperstone, noted, "We should remain cautious about a BTC strategic reserve, as it isn't likely to materialize in the immediate future. Trump's comments do provide some hopeful sentiments, but there are many considerations to keep in mind."
Crypto Market Surge
Since Trump’s election on November 5, Bitcoin's value has increased by more than 50%. The entire cryptocurrency market's value has nearly doubled this year, reaching a new peak of over $3.8 trillion, as reported by CoinGecko.
Once dismissive of cryptocurrencies, Trump has turned his stance around during his campaign, vowing to make the US the "crypto capital of the planet." He recently appointed a White House czar for artificial intelligence and cryptocurrencies, David Sacks, a former PayPal executive and a close ally of Trump adviser Elon Musk.
Additionally, Trump has indicated plans to nominate Paul Atkins, a pro-crypto lawyer, to lead the Securities and Exchange Commission (SEC). Notably, Nasdaq announced recently that MicroStrategy would be added to the Nasdaq-100 Index, effective before the market opens on December 23.
MicroStrategy, a major player in Bitcoin investments, has seen its shares skyrocket over six-fold this year, elevating its market value to nearly $94 billion. The firm now holds the largest corporate stake in Bitcoin.
Weston from Pepperstone suggested that the market is already anticipating that MicroStrategy CEO Michael Saylor will take advantage of the expected increase in MicroStrategy’s share price to buy more Bitcoin using proceeds from selling some of his shares.
Bitcoin, Trump, Crypto