Bitcoin Hits a Milestone $100,000

On Wednesday night, the aspirations of cryptocurrency enthusiasts came to fruition as Bitcoin reached the milestone of $100,000 in New York.

Following a month-long surge, the leading cryptocurrency has been fluctuating around this coveted figure, teasing investors with its proximity before finally breaking through.

The recent price movement is fueled by optimism within the digital asset sector, particularly the anticipation that President-elect Donald Trump will roll back the stringent regulatory measures enforced during his predecessor’s term. Instead, Trump is expected to adopt a more favorable stance toward the crypto industry.

Concrete evidence supporting this optimism emerged on Wednesday with Trump’s nomination of Paul Atkins, a pro-crypto advocate, to take over from Gary Gensler at the U.S. Securities and Exchange Commission (SEC).

“Paul Atkins is perfectly suited for this role,” stated Dan Gallagher, legal chief of Robinhood Markets Inc., during the firm’s investor day in New York. Gallagher, who had previously withdrawn from consideration for the SEC position, expressed confidence that Atkins would tackle the industry’s regulatory challenges from day one.

With Bitcoin surpassing the $100,000 mark, its market capitalization exceeded $2 trillion, positioning it as a more significant investment asset than all but a few major public companies, including Nvidia, Apple, and Alphabet, Google’s parent company. This valuation is also greater than the government bond markets of countries like Spain and Brazil and is approaching the total market cap of the FTSE 100 Index in the UK.

“Bitcoin reaching $100,000 marks the beginning of a new phase in the bull run, which now seems resilient to all but external shocks,” commented Fadi Aboualfa, head of research at crypto custodian Copper Technologies Ltd.

Following its breakthrough, Bitcoin soared to a peak of $103,800.

Even before Trump’s election, many crypto investors believed that reaching $100,000 was inevitable. Hedge-fund manager Anthony Scaramucci predicted in September that Bitcoin would achieve this milestone by year-end, while billionaire Michael Novogratz voiced similar expectations earlier in the year. Major banks like JPMorgan Chase and Goldman Sachs had also forecasted the six-figure price point nearly four years ago.

Launched in 2009 by the pseudonymous Satoshi Nakamoto in the wake of the global financial crisis, Bitcoin was designed as a decentralized peer-to-peer currency. The true identity of Nakamoto remains a topic of much speculation.

Bitcoin’s ascent to $100,000 came after a remarkable 135% year-to-date rally and is no stranger to dramatic price fluctuations. After ending 2010 around 30 cents, Bitcoin surged 157% in 2021 following a 64% crash the previous year. Historical spikes include gains of 1,375% in 2017, 5,428% in 2013, and 1,317% in 2011.

The journey from mere cents to $100,000 has been fraught with challenges, often referred to by crypto traders as “FUD”—fear, uncertainty, and doubt. The cryptocurrency landscape has been plagued by scams, ransomware attacks, and money laundering activities.

In March of this year, Bitcoin reclaimed its previous record of over $73,000, marking a full recovery from a turbulent period that saw its value plummet nearly 80% from November 2021 to November 2022. This bear market was characterized by high-profile failures, including the collapse of the FTX exchange, as well as the downfalls of crypto lenders Genesis and Celsius. The ensuing government crackdown resulted in prison sentences for FTX founder Sam Bankman-Fried and Binance founder Changpeng Zhao for failing to meet regulatory standards.

Despite the troubled history of the crypto market, Bitcoin is increasingly being embraced by mainstream finance. As the cryptocurrency continues to grow in prominence, its potential to become a crucial component of the global financial system becomes more pronounced.

Prior to Trump’s election, Bitcoin’s price rally was driven by the launch of exchange-traded funds (ETFs) that directly invest in the cryptocurrency after a lengthy legal battle with the SEC. Major players like BlackRock Inc., Fidelity, and Grayscale Investments have propelled the ETFs to approximately $100 billion in assets, accounting for around 5% of all Bitcoin in circulation.

“The demand outlook is strong,” noted Manuel Villegas, digital assets analyst at Julius Baer. “It’s reasonable to think we might witness another round of supply constraints next year—similar to what we anticipated last year when demand outpaced supply significantly.”

Trump’s potential return to the White House could introduce a new major player into the Bitcoin market: the U.S. government itself. During a Bitcoin conference in July, Trump announced plans to create a strategic stockpile of Bitcoin, beginning with assets seized by the government. At the same event, Trump allies Robert Kennedy Jr. and Senator Cynthia Lummis suggested that the government could purchase 1 million Bitcoin—worth approximately $100 billion at current prices—as a way to support the U.S. dollar.