Bitcoin's Record Run: Trump's Win, ETFs, and Other Catalysts That Drove Its 2024 Rally

Blink and you might have missed it, but Bitcoin (BTC) made history in 2024, crossing the $100,000 mark for the first time. A pivotal driver was the electoral victory of Donald Trump, who campaigned as a pro-cryptocurrency candidate. Following his win, Bitcoin surged 41%, peaking at $108,000 (Arslan Butt, Sunday, December 29, 2024). Let's break down the key catalysts that fueled Bitcoin's record-breaking year.



1. Trump Presidency: A Pro-Crypto Boost
Trump's commitment to cryptocurrency was evident through his proposal for a national Bitcoin reserve and his appointment of venture capitalist David Sacks as the first "White House A.I. & Crypto Czar." These actions signaled a government shift toward embracing digital assets, instilling confidence among investors and institutions alike. Following Trump's win, Bitcoin surged 41%, peaking at $108,000, demonstrating investors' enthusiasm for the Trump administration's pro-crypto stance.

2. Spot Bitcoin ETFs: A Game-Changer
The debut of spot Bitcoin exchange-traded funds (ETFs) in early 2024 was another major catalyst for Bitcoin's record-breaking year. These ETFs drew nearly $36 billion in net inflows, according to SoSo Value, with $2 billion in transactions by December. BlackRock's iShares Bitcoin Trust ETF (IBIT) led the market, amassing over $52 billion in assets, marking a significant step in institutional adoption of cryptocurrency. The ETFs provided traditional investors with easier access to Bitcoin, bolstering its appeal as a mainstream asset class.



3. Monetary Policy and Bitcoin's Halving Event
In September, the Federal Reserve enacted a 0.5% interest rate cut—the first in over four years—providing a favorable environment for risk-on assets like Bitcoin. This reduction, coupled with subsequent rate cuts, increased liquidity and borrowing power, spurring investments in cryptocurrencies. Bitcoin's halving event in April further fueled its bullish momentum. The mining reward was reduced from 6.25 BTC to 3.125 BTC per block, reinforcing Bitcoin's deflationary nature. While halving is a cyclical event, its impact on Bitcoin's supply and investor sentiment continues to play a critical role in driving demand.



4. Other Catalysts Driving Bitcoin's 2024 Rally
Apart from Trump's presidency and the launch of spot Bitcoin ETFs, other factors contributed to Bitcoin's record-breaking performance in 2024. These include:
- Mt. Gox Payments and Other Macro Headwinds: In July, the Mt. Gox bankruptcy trustee began transferring Bitcoin to creditors, sparking concerns of market sell-offs. These large transfers, combined with US and German government attempts to liquidate Bitcoin holdings, caused Bitcoin's price to dip below $50,000 in the summer. Despite these challenges, Bitcoin's record-breaking performance in the latter part of 2024 was undeniable.
- MicroStrategy's Continued Support: One notable constant throughout the year has been MicroStrategy's unwavering commitment to Bitcoin. The company made significant purchases in November, buying $5.4 billion worth of Bitcoin as its price hovered around $97,000. With over 444,000 BTC in its coffers, MicroStrategy has emerged as one of the biggest institutional Bitcoin holders. Founder Michael Saylor's message has remained clear: the company will continue to accumulate Bitcoin, adding long-term support to the market.



In conclusion, 2024 was a defining year for Bitcoin, with the cryptocurrency soaring to new heights despite its fair share of turbulence. From groundbreaking regulatory moves to market-shifting political developments, Bitcoin's journey has been anything but predictable. As we look back, the key catalysts that fueled its rise this year—and what they could mean for the future as we head into 2025—are clear.