The price of bitcoin regained the $100,000 mark (€96,300) on Monday, thanks to a sharp drop in the US dollar.
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Bitcoin saw a major resurgence on Monday, increasing by 4% to exceed the $100,000 threshold for the first time since December 19.
The cryptocurrency market saw more than $900 million (€867 million) inflows into spot bitcoin exchange-traded funds (ETFs) on the same day, a sign of renewed interest in the part of investors.
Despite this, the sustainability of the recovery remains uncertain, as institutional buying volumes have been relatively lowaccording to Coinbase data. On Tuesday, at the start of the Asian session, bitcoin fell slightly, trading at $101,670 (€97,900) at 4:30 a.m. CET.
Bitcoin Resurgence Aligns With US Dollar Weakness
The rise of bitcoin coincided with a significant drop in the US dollar, which fell sharply on Monday following a Washington Post article according to which Donald Trump would consider softening his stance on customs duties.
This decline supported other assets, including global stock markets and bitcoin. The euro also recorded its biggest one-day rise against the dollar in 14 months.
However, the president-elect of the United States denied the Washington Post’s information on his Truth Social website, contesting the idea that his “pricing policy would be revised downwards”.
The dollar has lost some of its initial gains but is expected to continue its upward trend ahead of Donald Trump’s inauguration on January 20, continuing to put pressure on bitcoin and other currencies.
Decline at the end of the year against a backdrop of profit taking and Fed policy
The bitcoin a peaked at more than $108,000 (€104,000) on December 17, following a reduction in interest rates by the Federal Reserve.
-By the very end of 2024, however, bitcoin had fallen by around 16%, closing the year at just over $91,000 (€86,700). Profit-taking and reduced trading volumes during the holiday season contributed to the decline.
Data from Coinbase revealed that bitcoin trading volumes have declined since the US presidential election. Even with Monday’s price rise, business activity remained below levels seen during the Fed’s December interest rate decision.
However, many analysts believe the world’s largest cryptocurrency will continue its rise in 2025.
“The performance of bitcoin and cryptocurrency in 2024 confirms that it deserves a place in a diversified investment portfolio”estimates Josh Gibert, market analyst at eToro Australia.
Investors eye further rise after Donald Trump’s inauguration
Options markets have seen growing interest in betting prices above the $100,000 mark, with the call option at $120,000 (€115,600) with an expiration date of March 28 being the most popular option on Deribit.
This suggests that traders expect Donald Trump administration to impose cryptocurrency-friendly regulations and push bitcoin price to new high.
The president-elect’s inauguration is scheduled for January 20, and markets are anticipating moves to ease regulations to deliver on his promise to make a U.S. “the cryptocurrency capital of the planet”.
ADVERTISEMENTIn December, Donald Trump reiterated his intention to include bitcoin in the United States’ strategic reserves.
