Crypto Quill

Bitcoin is on the brink of reaching a historic milestone, with its price hovering just under $90,000 for the first time ever. This surge comes after a dramatic rise, having already breached $80,000 earlier in the week. As of Monday night, Bitcoin was trading at approximately $89,100, a 12% increase, with its all-time high reaching $89,623 earlier that day.

Analysts and investors are predicting that Bitcoin could continue its upward trajectory, with many forecasting that it will hit the $100,000 mark before the end of the year. This optimism has been fueled by a combination of factors, including a pro-crypto regulatory environment promised by President-elect Donald Trump and a strong market sentiment.

Bitcoin Enters ‘Price Discovery Mode’

Bitcoin’s latest rally began with the official declaration of Trump’s election victory, pushing the digital asset into what experts are calling “price discovery mode.” Mike Colonnese, an analyst at H.C. Wainwright, noted that after breaking through its previous all-time highs, Bitcoin is now entering a phase where its price is likely to continue making new records.

“Strong positive sentiment is likely to persist through the balance of 2024, and we see Bitcoin prices potentially reaching the six-figure mark by the end of this year,” Colonnese said.

Trump’s Pro-Crypto Stance Energizes Market

A key factor behind Bitcoin’s rise is the expectation of more favorable regulations under Trump’s administration. Crypto investors have long struggled with unclear regulatory guidelines, but Trump’s promises to create a more supportive environment for the industry have sparked renewed optimism.

Matt Hougan, Chief Investment Officer at Bitwise Asset Management, explained that the shift in regulation has turned the market on its head. “We’re now in a positive regulatory environment, and that comes in the case of a market that was already in a bull market… that’s going to push us higher,” Hougan told CNBC.

Trump’s pro-crypto stance is seen as a critical development, especially for crypto businesses that have faced challenges due to regulatory ambiguity. With a shift towards a friendlier regulatory environment, many investors are betting that the crypto market will continue to rise.

Broader Crypto Market Soars

Bitcoin’s surge is not the only indicator of the growing optimism within the cryptocurrency market. Other digital assets are also seeing significant gains. Ether rose by 5.8%, while XRP, the token linked to payments, increased by nearly 4%. Polygon, a token associated with decentralized finance (DeFi), also gained more than 4%.

Dogecoin, which has strong ties to Elon Musk and his influence in supporting Trump, was one of the standout performers, surging by 38%.

Crypto Stocks See Gains

The cryptocurrency boom is spilling over into the stock market as well. Companies like Coinbase and MicroStrategy have also benefitted from the crypto rally, with their stocks up by about 3% and 5%, respectively, in extended trading. Coinbase, in particular, saw a 19% jump on Monday, trading above $300 for the first time since 2021.

What’s Next for Bitcoin?

Traders and analysts agree that this rally is just getting started. Hougan pointed out that there appears to be an “air gap” between Bitcoin’s previous all-time highs around $72,000 and its potential to hit $100,000. “It’s hard exactly to see what would force sellers to come into this market and halt the momentum before we get to that level,” he said.

Despite the potential for pullbacks, the prevailing sentiment is overwhelmingly bullish. Analysts believe the market is entering a new cycle, and the upward momentum for Bitcoin shows no signs of stopping.