Bitcoin's remarkable rally continued on Monday, surging past $82,000 for the first time, driven by optimism around a pro-crypto environment in the wake of Donald Trump's return to the White House. The original cryptocurrency's rise has been fueled by a wave of investor confidence and expectations for more favorable regulatory treatment, as signaled by key appointments and statements from the president-elect.
Bitcoin traded as high as $82,413 early Monday before settling slightly lower at $82,000, marking a 3% increase over the past 24 hours and a 20% gain within the last week. The record high, adjusted for inflation, marks a significant milestone for the cryptocurrency, which has more than doubled from its value of approximately $37,000 just a year ago.
The surge in bitcoin's price is part of what some are calling the "Trump pump," reflecting expectations that his presidency will foster an accommodating environment for digital assets. During his campaign, Trump shifted from calling bitcoin a "scam against the dollar" to becoming a vocal supporter of cryptocurrency. His administration is expected to pursue a more lenient regulatory approach, potentially boosting retail and institutional investment in digital assets.
"Trump's victory and the pro-crypto stance of figures such as Ohio Senate winner Bernie Moreno have created a sense of optimism among crypto investors," said Noelle Acheson, author of a widely-read cryptocurrency newsletter. "The possibility of a national strategic bitcoin reserve and regulatory changes favoring crypto have added strong tailwinds to the rally."
Trump's campaign promises included creating a strategic bitcoin stockpile, drawing comparisons to America's strategic petroleum reserve. The announcement has bolstered market sentiment, with analysts predicting further growth for bitcoin and other cryptocurrencies.
Investor confidence has also been fueled by the anticipated dismissal of Securities and Exchange Commission (SEC) Chair Gary Gensler, known for his tough stance on cryptocurrency regulation. "Trump has promised to fire Gensler 'on day one,' signaling a clear departure from the SEC's recent crackdown on crypto," said Ronald Temple, chief market strategist at Lazard. Gensler's tenure was marked by a series of regulatory actions against digital asset firms, leading to significant uncertainty within the industry.
The positive market sentiment has extended beyond bitcoin. Shares of major crypto exchange Coinbase surged by 16% in pre-market trading, building on a 40% jump since the election result was confirmed. MicroStrategy, a software company with significant bitcoin holdings, saw its stock rise 12% in early trading. Ethereum, dogecoin, and other cryptocurrencies have also seen substantial price increases.
Elon Musk, a prominent Trump supporter and crypto enthusiast, has played a role in driving sentiment as well. His favored cryptocurrency, dogecoin, has surged more than 160% over the past month. Musk's wealth reportedly increased by $26.5 billion following the election results, further boosting market confidence.
Despite the rally, some analysts remain cautious. "While the short-term outlook appears bullish, the market should remain wary of potential regulatory and macroeconomic changes," warned Acheson. The impact of Trump's policies on broader inflation and market stability is also a subject of debate, with fears that measures like tax cuts and tariffs could lead to price increases in basic goods.
