Cyber Monday Deal: Up to 60% off InvestingProCLAIM SALE

Record-breaking bitcoin surges towards $90,000 on Trump boost

Published 12/11/2024, 01:27 pm
Updated 12/11/2024, 10:39 pm
© Reuters. FILE PHOTO: Physical representations of the bitcoin cryptocurrency are seen in this illustration taken October 24, 2023. REUTERS/Dado Ruvic/Illustration/File Photo
TSLA
-
RIOT
-
MSTR
-
BTC/USD
-
CLSK
-

By Tom Westbrook and Harry Robertson

SINGAPORE/LONDON (Reuters) -Bitcoin rallied to the verge of $90,000 on Tuesday, riding a wave of euphoria since the election of Donald Trump as U.S. president on expectations his administration will be crypto friendly.

The world's biggest cryptocurrency has become one of the most eye-catching movers in the week since the election and touched $89,982 - a gain of around 30% since Nov. 5. It was last down 1.4% at $86,730.

Bitcoin is surging along with Elon Musk's automaker Tesla (NASDAQ:TSLA), which is up nearly 40% since voting results rolled in, as investors figure Trump's friends and interests will do well while he is in office.

"The crypto enthusiasts think they have a like-minded incoming president," said Alvin Tan, head of Asia FX strategy at RBC Capital Markets.

"The thing about bitcoin at the end of the day is that there is no valuation anchor to it, it's hard to get a grip on fair value. So when sentiment is very positive, it does get carried away a lot more than other asset classes."

Trump embraced digital assets during his campaign, promising to make the United States the "crypto capital of the planet" and to accumulate a national stockpile of bitcoin.

It is not clear how or when that could happen but the possibility drove a speculative surge in crypto mining and trading stocks.

"I think it increases the chances that other nation states buy bitcoin in a bid to front run the U.S.," said Matthew Dibb, chief investment officer at cryptocurrency asset manager Astronaut Capital.

"Additionally I think it would be a crazy catalyst for the U.S. listed bitcoin miners ... given possibilities of such entities getting nationalised."

Crypto miner Riot Platforms (NASDAQ:RIOT) jumped nearly 17% on Wall Street on Monday. Fellow miners MARA Holdings and CleanSpark (NASDAQ:CLSK) leapt nearly 30%.

Software (ETR:SOWGn) company and investor in bitcoin MicroStrategy announced it had spent about $2 billion buying bitcoin between Oct. 31 and Nov. 10. Shares rose 26% on Monday.

"Obviously (it's) a clear Trump trade as he is so supportive of the industry, and this can only mean more demand both for crypto stocks as well as the currencies themselves," Nick Twidale, chief market analyst at ATFX Global in Sydney, said of the bitcoin rally.

"The fact that bitcoin was trading near all-time highs when the election result came through meant that it had clean sky above."

The euphoria extended across the crypto landscape with smaller tokens such as ether and dogecoin surging, although they dipped on Tuesday morning in Europe.

© Reuters. FILE PHOTO: Physical representations of the bitcoin cryptocurrency are seen in this illustration taken October 24, 2023. REUTERS/Dado Ruvic/Illustration/File Photo

Crypto investors see an end to increased scrutiny under U.S. Securities and Exchange Commission Chair Gary Gensler whom Trump has said he will replace. Trump also unveiled a new crypto business, World Liberty Financial, in September.

"What we're seeing isn't just a price milestone; it's a signal that the market is warming to the idea of bitcoin as a more stable, even politically favoured, asset," said Justin D'Anethan, head of Asia-Pacific business development at digital assets market maker Keyrock.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.