The Path to $100,000: Understanding Bitcoin's Remarkable 2024 Surge

A novelty Bitcoin token is displayed in front of the cryptocurrency's price against the US dollar, which surpassed $100,000 in Hong Kong, China, on Thursday, December 5, 2024.

Bitcoin has finally achieved a significant milestone of surpassing $100,000, marking the peak of a year in which it gained acceptance from major Wall Street firms and became a focal point during the U.S. presidential elections.

For some time, bitcoin advocates have predicted a rise to $100,000, highlighting their confidence in the digital currency. However, many on Wall Street were skeptical of these predictions. Bitcoin crossed the six-figure mark Wednesday night and has surged over 140% in 2024.

Wall Street's Growing Acceptance

The start of 2024 has been pivotal for bitcoin, particularly with the debut of its first exchange-traded funds (ETFs) on January 11. These new funds attracted billions of dollars shortly after their launch, especially the iShares Bitcoin Trust (IBIT), which now boasts approximately $50 billion in assets.

While some investment firms continue to hold back, the rapid growth of these funds is a clear indicator of bitcoin's increasing acceptance within the traditional financial sector. Once perceived primarily as a speculative asset for individual investors, institutional interest has significantly enhanced bitcoin's standing.

According to Geoff Kendrick, global head of digital assets research at Standard Chartered Bank, "Institutions have net-bought 683,000 bitcoins year-to-date, through U.S. spot ETFs as well as large acquisitions by MicroStrategy, a software firm and a notable Bitcoin proxy. Notably, 245,000 of these inflows have taken place in the weeks following the U.S. election, which has propelled BTC over the $100,000 threshold."

Political Influence of Bitcoin

The cryptocurrency has also made significant strides in the political arena in the United States. During the 2024 election cycle, the crypto lobby invested heavily, and President-elect Donald Trump appears to have embraced bitcoin and its ecosystem.

Trump attended the Bitcoin Conference in Nashville as part of his campaign events. His choice for chair of the Securities and Exchange Commission, Paul Atkins, is considered supportive of the crypto industry, marking a sharp contrast to the current SEC Chair Gary Gensler.

Vlad Tenev, CEO of Robinhood, noted on a recent episode of "Squawk Box", "This current administration has been hostile to crypto, which has made us, along with the broader industry, a target. Having leaders who understand and support this sector is critical for its growth." Robinhood is known for its cryptocurrency trading platform.

Since November 4, the day before the presidential election, bitcoin's price has jumped 49%.

Additionally, Federal Reserve Chair Jerome Powell may have contributed to bitcoin's rise by acknowledging on Wednesday that bitcoin competes with gold rather than the U.S. dollar. While this might not be a strong endorsement for cryptocurrency, comparing bitcoin to gold, one of the oldest investment commodities, adds a degree of legitimacy to its value.

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