An early Christmas present for Bitcoin believers as BTC breaks the important $100,000 barrier, meeting the predictions of many analysts who had forecast the cryptocurrency would hit $100k before year end. It’s done it with more than three weeks left in 2024.
As of early Thursday morning, Bitcoin was trading at $102k. This surge through the symbolic $100k mark came a few hours after comments from Fed Chair Jerome Powell referring to Bitcoin as ‘Digital Gold’”. It seems to have caused many crypto traders to hit the buy button.
Bitcoin’s move to $100,000 marks a historic moment in the evolution of digital assets. Cryptocurrency analysts are saying this morning (Thursday) that the important milestone reflects growing confidence in Bitcoin as a store of value and a hedge against macroeconomic uncertainty. It is the asset’s global nature that is also giving it appeal, allowing anyone anywhere in the world to purchase it.
“This borderless asset continues to be adopted by individuals, institutions and governments alike, something that is envisaged to continue in the years to come,” said Brett Reeves, Head of Go Network at institutional digital asset infrastructure provider BitGo.
I want Bitcoin – where do I go?
Faisal Sheikh, Managing Director at Monmouth Capital commented: “Whether you’re a crypto believer or unbeliever, in breaking the $100k barrier Bitcoin has arrived. Ordinary investors who are interested in exposure to crypto and haven’t yet got their head around wallets, exchanges and long secret pass phrases have options.”
Sheikh said one example is a London-listed fund, the VanEck Crypto & Blockchain Innovators UCITS ETF. It holds a collection of companies exposed to Bitcoin, cryptocurrencies and blockchain technologies, such as Coinbase, Microstrategy and Riot. “However, any investment should come with a serious financial health warning: as you would expect, this ETF is heavily linked to the price of Bitcoin and is very volatile,” he said. “Swings of 5% to 10% up or down in a day are not uncommon so this is absolutely not investment advice.”
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ETFs remain a driver for cryptocurrencies
Prem Raja, Head of Trading Floor at Currencies 4 said ETF flows are still strong and show that Bitcoin has succeeded as an asset, although unfortunately not as a method of payment. “Expect Altcoins such as Ethereum to benefit from this current bull market as Altcoins begin to pick up steam after Bitcoin stops for a breather,” he said.
Despite Bitcoin reaching $100,000 being a significant psychological threshold the most important consideration of this event is that although Bitcoin is a Bellwether for the broader digital asset class, the more significant takeaway is that this will increase the likelihood of more institutions and traditional finance investment in the sector.
“This price appreciation is driven by the perception of an incoming crypto friendly administration resulting from Donald Trump’s election victory, as well as an increase in accessibility to digital assets for investors via the introduction of new Exchange Trade Products and greater regulatory clarity globally,” said Pascal St-Jean, CEO at global digital asset investment manager 3iQ. “Crypto is also being more widely accepted by governments around the world who are now more accepting of the benefits it delivers, namely financial inclusion.”
Bitcoin has added close to 50% in value since US voters went to the polls in early November, when Donald Trump claimed a decisive and undisputed election victory. Trump is strongly pro-crypto, perhaps more accurately described as a real ‘crypto-bro’ like his new best friend, Elon Musk.
Investors expect a Trump administration to push for a much friendlier regulatory framework than the one that currently exists. Back in July, Trump was in Nashville where he headlined the year’s biggest Bitcoin conference. He stated then: “If crypto is going to define the future, I want it to be mined, minted and made in the USA.”
Bitcoin began the year just over $40,000, having doubled in 2023. By March it had topped $73,000, hitting a fresh all-time high. But in early August it slumped, as did US stock indices, when the Japanese Yen carry trade blew up. Bitcoin briefly traded below $50,000. But then upside momentum kicked in. It soared to a fresh record following Trump’s victory. It hasn’t looked back since.
