Can Bitcoin’s Price Reach $100,000?

By Kyle Rodda10:19 (UTC), 22 November 2024

Bitcoin’s price is surging once again. So, what’s driving the rally? Can it continue? And will the crypto hit the $US100,000 milestone?

What is driving Bitcoin’s price rally?

Since the 2024 U.S. Presidential election, Bitcoin has staged a remarkable rally, climbing to record highs. This surge reflects a confluence of political developments, shifting market sentiment, and increasing institutional interest.

First and foremost, the election of a pro-crypto administration has been a game-changer for Bitcoin. President Donald Trump’s reelection has brought renewed optimism to the cryptocurrency space, with pledges to position the U.S. as a global leader in digital assets. Among these proposals are plans to establish a national Bitcoin reserve and bolster blockchain innovation, setting the stage for a potentially transformative policy shift.

Regulatory expectations are also playing a significant role. The market anticipates a more crypto-friendly environment, particularly given the potential dismissal of SEC Chairman Gary Gensler, who has been criticised for his stringent regulatory approach. A lighter regulatory touch could unlock further growth and innovation across the sector, encouraging broader adoption of digital assets.

Additionally, institutional participation in Bitcoin has ramped up significantly. Prominent hedge funds such as Tudor Investment and Millennium Management have been increasing their exposure to Bitcoin ETFs, signalling confidence in the long-term viability of the asset. This wave of institutional interest has further fueled upward momentum in Bitcoin’s price.

Lastly, speculative enthusiasm cannot be discounted. The alignment of political and regulatory optimism with increasing adoption has created a feedback loop, attracting both retail and institutional investors.

Past performance is not a reliable indicator of future results.
_{(Source: Trading View)}

Can Bitcoin’s rally continue?

Bitcoin’s performance in 2025 will hinge on a mix of macroeconomic, geopolitical, and regulatory factors, creating a nuanced backdrop for investors to navigate.

A major driver could be President Trump’s fiscal policy. With a focus on tax cuts and infrastructure spending, government debt is expected to rise significantly. This could fuel inflationary pressures, particularly as fiscal-driven demand impacts an already fragile economic balance. A weaker U.S. dollar under such conditions would likely enhance Bitcoin’s appeal as a hedge against currency debasement and inflation—a narrative that has historically supported its value.

Geopolitical tensions are another critical consideration. The prolonged Russia-Ukraine War and the Israel-Hamas conflict inject significant uncertainty into global markets. Bitcoin has often benefitted from such instability, serving as a decentralised asset free from traditional geopolitical risks. Moreover, sanctions and financial restrictions in affected regions could drive demand for Bitcoin as a cross-border payment tool and store of value.

Monetary policy will remain central to Bitcoin’s outlook. Should the Federal Reserve pivot to a more accommodative stance, either through rate cuts or renewed quantitative easing, the resultant liquidity injection would likely benefit speculative assets. Bitcoin, in particular, has shown a strong correlation with looser monetary conditions in recent cycles.

Finally, regulatory risks appear to be easing. A more crypto-friendly administration is expected to foster innovation while reducing compliance burdens for market participants. This could drive increased institutional engagement, which has historically bolstered Bitcoin’s legitimacy and adoption.

Will Bitcoin hit $US100,000?

Bitcoin has already come within touching distance of the six-figure milestone. If history is any guide, crypto could hit that level in the near future.

Bitcoin has a history of end of year melt-ups. For example, the moves from the middle of November to the start of January in 2016, 2017 and 2020 resulted in approximately 60%, 180% and 160% gains. If history is a guide, it could see Bitcoin give $US100,000 a nudge before the end of the year*.

There is also evidence that the market hasn’t hit peak euphoria yet. Google Trends data, which is often an indicator of public awareness and sentiment, suggests that searches for Bitcoin have yet to challenge the lofty highs of previous Bitcoin bull markets.

_{(Source: Google Trends)}

While the trend remains bullish for Bitcoin, the crypto remains a very volatile asset, meaning sentiment can swing rapidly. It means that there is always the risk that the crypto’s price could also drop very quickly if market conditions change.

Past performance is not a reliable indicator of future results.

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