SINGAPORE – Bitcoin rose above US$100,000 for the first time after US President-elect Donald Trump picked a crypto proponent to be the next head of the US securities regulator.
The world’s largest digital asset rose more than 3 per cent to US$101,555 in Asian trading on Dec 5.
Bitcoin has more than doubled in 2024 and is up about 45 per cent in the four weeks since Trump’s sweeping election victory on Nov 5.
The crypto market overall has jumped by roughly US$1.4 trillion (S$1.88 trillion) since Trump’s US election victory on Nov. 5 on a platform that includes a tight embrace of crypto.
Speculators also digested comments from Russian President Vladimir Putin, who said at an economic forum in Moscow that nobody can prohibit the use of Bitcoin and other virtual currencies.
Trump selected Mr Paul Atkins to replace outgoing Securities and Exchange Commission (SEC) chairman Gary Gensler, who cracked down on digital assets after a 2022 market rout exposed fraudulent practices and sparked costly blow-ups.
Mr Atkins, a former SEC commissioner, has been involved in crypto policy as co-chair of the Token Alliance, which works to “develop best practices for digital asset issuances and trading platforms”, and the Chamber of Digital Commerce.
“Bitcoin crossing US$100,000 is more than just a milestone; it’s a testament to shifting tides in finance, technology, and geopolitics,” said Hong Kong-based independent crypto analyst Justin D’Anethan.
“The figure not that long ago dismissed as fantasy, stands as a reality.”
More than 16 years after its creation, Bitcoin appears on the cusp of mainstream acceptance, despite naysayers and a history of controversies.
“We’re witnessing a paradigm shift. After four years of political purgatory, Bitcoin and the entire digital asset ecosystem are on the brink of entering the financial mainstream,” said Mr Mike Novogratz, founder and chief executive of US crypto firm Galaxy Digital.
“This momentum is fuelled by institutional adoption, advancements in tokenisation and payments, and a clearer regulatory path.”
Trump embraced digital assets during his campaign, promising to make the US the “crypto capital of the planet” and to accumulate a national stockpile of Bitcoin.
A slew of crypto companies including Ripple, Kraken and Circle are jostling for a seat on Trump’s promised crypto advisory council, seeking a say in his planned overhaul of US policy, according to several digital asset industry executives.
Trump’s businesses may also have a stake in the sector. He unveiled a new crypto business, World Liberty Financial, in September.
Although details about the business have been scarce, investors have taken his personal interest in the sector as a bullish signal.
Trump’s social media company is in advanced talks to buy crypto trading firm Bakkt, the Financial Times reported last week, citing two people with knowledge of the talks.
Trump Media and Technology Group, which operates Truth Social, is close to an all-stock acquisition of Bakkt, according to the FT report.
Billionaire Elon Musk, a major Trump ally, is also a proponent of cryptocurrencies.
Bitcoin’s rebound from a slide below US$16,000 in late 2022 has been rapid, boosted by the approval of US-listed Bitcoin exchange-traded funds (ETFs) in January 2024.
The SEC had long attempted to block ETFs from investing in Bitcoin, citing investor protection concerns, but the products have allowed more investors, including institutional investors, to gain exposure to Bitcoin.
More than US$4 billion has streamed into US-listed Bitcoin exchange-traded funds since the election.
“We were trading basically sideways for about seven months, then immediately after November 5, US investors resumed buying hand-over-fist,” said Mr Joe McCann, CEO and founder of Asymmetric, a Miami digital assets hedge fund.
Crypto-related stocks have soared along with the Bitcoin price, with shares in Bitcoin miner Mara Holdings up around 65 per cent in November.
Yet the rise is not without critics.
Two years ago, the industry was wracked by scandal with the collapse of the FTX crypto exchange and the jailing of its founder Sam Bankman-Fried.
The cryptocurrency industry also has been criticised for its massive energy usage, while crypto crime remains a concern, too.
Market participants are keeping a close eye on what happens now that Bitcoin has broken above US$100,000, with investors and speculators possibly looking to pocket some of their recent gains.
“But once we flush out those sell orders, this could go higher still, and very rapidly,” said Mr Steven McClurg, founder of Canary Capital, a digital assets investment firm. He said he expects Bitcoin’s price to hit US$120,000 by Christmas. REUTERS, BLOOMBERG
