MUMBAI: Bitcoin’s triumphant journey continued as it smashed through the $107,000 mark, buoyed by President-elect Donald Trump’s pro-crypto stance and investor optimism.
President-elect Donald Trump’s plan to establish a US bitcoin strategic reserve, akin to the country’s strategic oil reserve, has sparked renewed enthusiasm among cryptocurrency investors, propelling Bitcoin to a record high.
On Monday, the world’s largest cryptocurrency climbed to a session high of $107,148 before settling at $106,877, up 5.43 per cent from late Friday.
Trump’s remarks during a CNBC interview last week signaled a potential pivot in US policy towards digital assets. “We’re going to do something great with crypto because we don’t want China or anyone else to take the lead,” Trump said, reaffirming earlier statements about building a strategic crypto reserve.
MicroStrategy in index
Investor sentiment was further buoyed by the inclusion of MicroStrategy into the Nasdaq-100 index, which is expected to drive fresh inflows into the software firm turned bitcoin heavyweight. Ether, the second-largest cryptocurrency, also gained 1.85 per cent to reach $3,975.70.
“We’re in blue-sky territory here,” said Tony Sycamore, an analyst at IG. “The market’s next target is $110,000. The pullback many expected hasn’t materialised, fueled by this latest news.”
Bitcoin’s value has skyrocketed nearly 150 per cent in 2024, with the cryptocurrency market as a whole nearing $3.8 trillion, according to CoinGecko. Trump’s pro-crypto stance marks a stark contrast to his previous skepticism, where he labeled digital currencies a scam.
His campaign promises to make the US the “crypto capital of the planet” have galvanised the sector.
Strategic appointments
As part of this push, Trump has named former PayPal executive David Sacks as the White House czar for artificial intelligence and cryptocurrencies, and he plans to nominate pro-crypto attorney Paul Atkins to head the Securities and Exchange Commission (SEC).
Governments worldwide are increasingly eyeing cryptocurrencies as strategic assets. The United States already holds nearly 200,000 bitcoins, valued at over $20 billion at current levels, according to CoinGecko. Other nations like China, Bhutan, El Salvador, and Russia have also invested in bitcoin.
Russian President Vladimir Putin recently criticised the US dollar’s dominance and suggested cryptocurrencies as a viable alternative. “For example, bitcoin – who can prohibit it? No one,” Putin said.
Despite the optimism, some analysts urge caution. “The creation of a bitcoin strategic reserve won’t happen overnight and would need careful planning,” said Chris Weston, head of research at Pepperstone.
Gold status
Federal Reserve Chair Jerome Powell has also likened bitcoin to gold, underscoring its speculative nature.
Adding to the market excitement, exchange operator Nasdaq announced that MicroStrategy, led by CEO Michael Saylor, will join the Nasdaq-100 Index on December 23. The inclusion is expected to boost MicroStrategy’s stock, enabling the company to expand its bitcoin holdings through fresh capital raised from debt and equity offerings.
“The inclusion of MicroStrategy seems unexpected, but it could initiate a cycle of capital inflows that drive up bitcoin’s spot price,” said Matthew Dibb, CIO at crypto asset manager Astronaut Capital. MicroStrategy shares, which have surged sixfold this year, were up another 4.2% on Monday.
With Trump’s ambitious plans and bitcoin’s meteoric rise, the cryptocurrency market is poised for an eventful year ahead, as both policy and market forces align to reshape its trajectory.
