The world’s largest cryptocurrency spiked to new heights on Tuesday, setting an early precedent in what analysts forecast is just the beginning.
Bitcoin rose above $90,000 on Tuesday afternoon, Coinbase data shows, securing the milestone after a close call late Monday. The leading cryptocurrency broke its record for the largest single-day gain in history on Monday, as measured in U.S. dollars.
The asset is up 115% this year, more than doubling its January 1 price of $42,000. Meanwhile, crypto’s total market capitalization has peaked above $3.1 trillion, breaking its November 2021 record of approximately $3.07 trillion.
It comes amid a surge in bullish sentiment across digital assets and broader equities following President-elect Donald Trump’s successful return bid for the White House last week.
Dubbed the “Trump Trade,” analysts previously told Decrypt they view Bitcoin and digital assets as a high-conviction play, particularly following the former president's inauguration on January 20.
"With the election overhang now behind us, the rally in crypto markets appears sustainable, buoyed by positive forward signals from the U.S," Julien Auchecorne, head of Auros Ventures, told Decrypt on Tuesday.
Exceeding forecasts made earlier in the year, the S&P 500 also rose above 6,000 points briefly for the first time last week, bolstered by a dovish U.S. Federal Reserve and easing interest rates. That's expected to lower borrowing costs and fuel further momentum into risk assets, including crypto.
Bitcoin Has Had a Lot of Good Days—It Just Had Its Best One Ever
Monday was a record-breaking day for the crypto industry, with Bitcoin surging all day and reaching a new all-time high price mark above $89,000. But it wasn’t just the day that we saw Bitcoin’s highest price yet, but also its biggest single day ever for dollar gains. Bitcoin jumped $8,343 over the course of the day Monday, from start to finish—and Galaxy Research data shows that it’s the largest single-day jump for the leading cryptocurrency when measured in U.S. dollars, citing data from crypt...
So where to from here?
Bitwise’s Chief Investment Officer Matt Hougan expects Bitcoin to breach $100,000 by year’s end and $200,000 by the end of 2025. Others, including New York's global investment management and research firm Bernstein, have offered similar targets.
Meanwhile, Bitwise's European Head, Bradley Duke, sees crypto riding on strong tailwinds—at least for the foreseeable future—with a changing political landscape in the U.S. likely to usher in a “golden age” for the industry, he told Decrypt in a statement.
Crypto’s Comeback: Are Surging Prices Here to Stay?
Crypto is back in full swing, with multiple digital assets breaking to highs not seen in months, while bellwether asset Bitcoin continues to set new records. The industry’s total market capitalization is fast approaching the $3 trillion mark, previously established during the height of the last significant bull run on November 9, 2021. But are the first signs of bubbling market froth sustainable? Bolstered by several tailwinds, including President-elect Donald Trump’s victory, solid corporate ea...
That coincides with the broader market's view of Trump’s win as a favorable environment, providing a clear runway in which deregulation and business-friendly policies alike are expected to fuel further rallies into next year.
For crypto, Trump’s administration is expected to drive regulation designed to establish a Bitcoin reserve, protect crypto mining interests, ease a hostile regulatory environment, and spur innovation.
While most view the market reaction to macro developments as firmly entrenched within a “sweet spot,” risks persist.
Those include geopolitical risks in the Middle East and Eastern Europe, ballooning U.S. debt, and possible climate disasters as potential catalysts for ending the party early.
For now, Bitcoin doesn’t seem to care.
Edited by Andrew Hayward
