Bitcoin hit the $100,000 milestone this week, marking a historic moment for the cryptocurrency. The surge, which saw the price briefly touch $104,000 on Dec. 5, represents a 126% increase from its January price of $44,000. This growth has been fueled by institutional adoption, Bitcoin ETF inflows, and market optimism following Donald Trump’s reelection as U.S. president.
Institutional interest remains a key driver. MicroStrategy, already the largest corporate Bitcoin holder, recently acquired an additional 15,400 BTC for $1.5 billion, bringing its total holdings to 402,100 BTC valued at over $40 billion. Other companies, including Acurx Pharmaceuticals, have followed suit. Acurx announced a $1 million Bitcoin purchase as a treasury reserve asset, citing its limited supply and inflation-resistant properties as strategic advantages.
Spot Bitcoin ETFs have also bolstered the rally. November recorded $6.1 billion in ETF inflows, with BlackRock’s iShares Bitcoin Trust accounting for $5.4 billion. The approval of spot Bitcoin ETFs in the U.S. earlier this year allowed investors easier access to the asset, contributing to its growing mainstream acceptance. Major financial institutions like Goldman Sachs and Tudor Investment Corporation have also entered the Bitcoin market through these vehicles.
Bitcoin’s supply dynamics have played a significant role in the price increase. April’s halving event, which reduced the mining reward, tightened Bitcoin’s supply and, as traditionally expected, led to significant price rallies. Over the past month alone, Bitcoin has gained 47%, supported by growing demand and reduced availability.
Political developments have added momentum to Bitcoin’s rise. Trump’s election victory in November and his pro-crypto stance have fueled optimism in the sector. His nomination of Paul Atkins, a crypto advocate, to replace outgoing Securities and Exchange Commission (SEC) Chair Gary Gensler signals a potential shift toward friendlier regulations. Trump has also proposed a national Bitcoin reserve, further driving speculation about the cryptocurrency’s role in future economic policy.
This rally has pushed Bitcoin’s market capitalization above $2 trillion for the first time, cementing its status as one of the world’s most valuable assets. While its 2024 growth is notable, it is not the most dramatic in Bitcoin’s history, as it saw a 1,900% surge in 2017 and a 1,250% jump during the COVID-19 pandemic.
Since its creation by the pseudonymous Satoshi Nakamoto in 2009, Bitcoin has evolved from a niche digital currency to a global financial asset embraced by institutional investors and corporations. Its $100,000 milestone underscores its growing significance in the world economy.