Bitcoin's Rise Is So Fast, But Will It Break The Historic $100,000 Mark?

Bitcoin prices are approaching the historic high of $100,000 due to market optimism that President-elect Trump's support for cryptocurrencies heralds a boom in the crypto market, with the U.S. shifting towards a crypto-friendly regulatory environment instead of the previous crackdown.

On Thursday, Bitcoin, the largest digital asset, rose by 3.6% and approached $98,000. Since Trump's election victory on November 5th, the entire cryptocurrency market has added about $900 billion in value.

Trump's transition team has begun discussions on whether to establish a position in the White House responsible for digital asset policy. This would be the first of its kind in the U.S., with direct contact with the incoming president, making Trump one of the biggest cheerleaders in the crypto community.

These discussions come as the latest boost to sentiment in the U.S. digital asset market, following MicroStrategy's accelerated Bitcoin purchases and the launch of U.S. Bitcoin ETF options.

Speculators are increasingly focused on when, rather than if, Bitcoin will break the $100,000 barrier. Supporters who view Bitcoin as a modern store of value see the six-figure price as a symbolic rebuttal to skeptics who argue that cryptocurrencies have little practical use and condemn their association with money laundering and crime.

Tony Sycamore, market analyst at IG Australia, said: Buyers are strangling the sellers. While I'm not sure it's all going to be smooth sailing as it edges closer to the $100,000 mark, the demand appears to be insatiable.

MicroStrategy, the company with the most Bitcoin holdings among publicly traded companies, announced on Wednesday that it plans to increase the sale of convertible senior notes by nearly 50%, to $2.6 billion, to fund the purchase of the token. The once obscure software manufacturer has now positioned itself as a Bitcoin asset management company, with approximately $31 billion in digital asset reserves.

ETF Inflows

Data compiled by institutions shows that after Election Day, 12 U.S. ETFs investing in Bitcoin attracted $5.8 billion in inflows, with the total assets of these ETFs reaching an unprecedented $100 billion.

Caroline Mauron, co-founder of Orbit Markets, a liquidity provider for crypto derivatives, said: While it's now firmly into overbought territory, it is being drawn toward the $100k level.

Trump has vowed to create a supportive U.S. cryptocurrency regulatory framework and establish a strategic Bitcoin reserve, although the implementation timeline and feasibility of the Bitcoin reserve remain uncertain.

Trump, once a skeptic of cryptocurrencies, changed his stance after digital asset companies heavily promoted their benefits during the campaign. He also has his own digital asset projects.

The current optimism has overshadowed memories of the 2022 market crash, which exposed fraud and other risky behaviors in the crypto community and led to the collapse of platforms including Sam Bankman-Fried's FTX exchange, with Bankman-Fried himself being imprisoned. The turmoil triggered a series of tough enforcement actions by the U.S. Securities and Exchange Commission (SEC), and the industry expects that this suppression will gradually disappear under Trump's administration