Bitcoin has made history once again, breaking through the $100,000 mark for the first time on Thursday. This milestone has been hailed by both supporters and skeptics as a coming-of-age for digital assets, as investors continue to bet on a friendly U.S. administration to solidify the place of cryptocurrencies in financial markets.
The surge in Bitcoin’s value was boosted by the nomination of pro-crypto Paul Atkins to run the Securities and Exchange Commission by U.S. President-elect Trump. This nomination, along with a slew of other pro-crypto lawmakers being elected to Congress, has propelled Bitcoin to an all-time high of $103,619, a 6% increase in just one day. As of writing, Bitcoin is currently valued at $102,650.
The total value of the cryptocurrency market has nearly doubled this year, reaching a record high of $3.8 trillion, according to data provider CoinGecko. To put this into perspective, Apple, one of the world’s most valuable companies, is worth around $3.7 trillion.
Bitcoin’s journey from the fringes of the libertarian movement to Wall Street has not only created millionaires, but also established a new asset class and popularized the concept of “decentralized finance” since its creation 16 years ago.
In 2021 alone, Bitcoin’s value has more than doubled, with a 50% increase in the four weeks since Donald Trump’s election victory. This surge in value has been driven by institutional adoption, advancements in tokenization and payments, and a clearer regulatory path.
Mike Novogratz, founder and CEO of U.S. crypto firm Galaxy Digital, believes that we are witnessing a paradigm shift in the financial world. He states, “Bitcoin and the entire digital asset ecosystem are on the brink of entering the financial mainstream – this momentum is fueled by institutional adoption, advancements in tokenization and payments, and a clearer regulatory path.”
During his campaign, Trump showed support for digital assets, promising to make the United States the “crypto capital of the planet” and to accumulate a national stockpile of Bitcoin. This support has only grown stronger since his election, with U.S. investors buying Bitcoin at a rapid pace since November 5th.
Joe McCann, CEO and founder of Asymmetric, a Miami-based digital assets hedge fund, explains, “We were trading basically sideways for about seven months, then immediately after Nov. 5, U.S. investors resumed buying hand-over-fist.”
Trump’s nomination of Paul Atkins to the SEC has been welcomed by Bitcoin’s supporters. As a former SEC commissioner and co-chair of the Token Alliance, Atkins has been involved in shaping crypto policy. Kristin Smith, CEO of the Blockchain Association, believes that Atkins will bring a new perspective and a deep understanding of the digital asset ecosystem to the SEC.
“We look forward to working with him and ushering in a new wave of American crypto innovation,” says Smith.
In addition to Atkins’ nomination, a number of crypto companies, including Ripple, Kraken, and Circle, are vying for a spot on Trump’s promised crypto advisory council.
Bitcoin’s resilience has been proven time and time again, surviving through major downturns. Its journey to six-figure territory is a remarkable comeback from its dip below $16,000 in 2022, when the industry was reeling from the collapse of the FTX exchange and its founder, Sam Bankman-Fried, was subsequently jailed.
Analysts attribute the record-breaking rally to the growing embrace of Bitcoin by big investors. The approval of U.S.-listed Bitcoin exchange-traded funds in January has been a major catalyst for large-scale buying, with over $4 billion streaming into these funds since the election.
Geoff Kendrick, global head of digital assets research at Standard Chartered, estimates that roughly 3% of the total supply of bitcoins that will ever exist have been purchased in 2021 by institutional money. He believes that digital assets are becoming normalized and will soon have a dedicated sales and trading desk alongside other traditional assets like FX, rates, and commodities.
The financialization of Bitcoin is already underway, with the launch of Bitcoin futures in 2017 and the successful debut of options on BlackRock’s ETF in November. Crypto-related stocks have also seen a surge in value, with shares in Bitcoin miner MARA Holdings and exchange operator Coinbase up around 65% in November. Software firm Microstrategy, which has repeatedly raised funds to buy Bitcoin
