Bitcoin Climbs Toward Record Highs as Traders Eye Trump’s Inauguration for Pro-Crypto Moves
Crypto traders are once again optimistic, with expectations that Bitcoin (BTC) could surpass its record highs as the inauguration of President-elect Donald Trump on January 20 approaches.
Since dipping below $90,000 on Monday, Bitcoin has surged by 11%, briefly topping $100,000 at one point, according to CoinDesk data. The rally in BTC was spurred by a softer-than-expected core CPI report, which alleviated fears of a hawkish Federal Reserve and pushed prices higher. Markets are now shifting their focus to Trump’s inauguration and the potential for a pro-crypto announcement on his first day in office.
Matt Mena, a crypto research strategist at 21Shares, believes the easing of inflation fears sets the stage for Bitcoin to break through the strong $100,000 resistance level. “This milestone would not only be psychologically significant but also technical, paving the way for Bitcoin to surpass its all-time high of $108,000,” Mena said in an email. 21Shares is one of the largest issuers of crypto exchange-traded products (ETPs) globally.
Mena added that Trump’s history of supporting pro-growth policies and asset price appreciation further boosts the bullish outlook for Bitcoin and other risk assets.
This bullish sentiment is mirrored in the traditional markets, particularly the Nasdaq 100, which surged by over 2% on Wednesday. Bitcoin has recently shown a strong correlation with the tech-heavy index, reaching a two-year high.
Meanwhile, the U.S. dollar index, which tracks the greenback’s value against major currencies, has stalled, providing a boost to risk assets. The S&P 500 is also approaching the 6,000 level, with a break above this level potentially signaling the next phase of a global asset bull market.
Once skeptical of digital assets, Trump has won the support of the crypto community in the months leading up to the November election. He pledged to create a national strategic bitcoin stockpile, and his victory helped propel Bitcoin from $70,000 to over $108,000.
Nathan Cox, CIO at Two Prime, a registered investment adviser specializing in digital asset derivatives, believes that any indication of a Strategic Bitcoin Reserve from Trump on day one could lead to significant price discovery. “Once we surpass the previous highs of $108,000, there’s no limit to how fast Bitcoin could expand,” Cox said, referring to the global demand such a reserve could create.
Paul Howard, a senior director at crypto market-making firm Wincent, warned that market pricing has yet to fully incorporate the expected announcements regarding digital asset regulations, banking rules, and the strategic bitcoin reserve. “We’re preparing for a volatile week ahead with the change in U.S. administration. We expect some +/-10% price swings across major assets like BTC, SOL, ETH, and XRP,” Howard said. “The pricing will reflect the outcomes of the incoming President’s announcements, so there are opportunities, though not everything, already factored into the current price.”
