Bitcoin surged past a record high of $75,000 following news of former President Donald Trump's success at the polls on Election Day.
The Republican president-elect sparked investor enthusiasm for cryptocurrencies during his campaign, pledging to make the U.S. the "crypto capital of the planet."
Early morning trading saw the digital asset rise by nearly eight percent, breaking its previous record set in March. Other cryptocurrencies followed the upward trend; Ether, the world's second-largest cryptocurrency, also rallied eight percent, while Dogecoin, famously favored by billionaire Elon Musk, increased 18 percent.
Trump's change in stance on digital currencies during his campaign amplified this growth. Once a crypto skeptic, Trump has since embraced the industry, proposing a "strategic reserve" of Bitcoin similar to what the U.S. does with gold.
His campaign accepted cryptocurrency donations, and he courted crypto enthusiasts at a Bitcoin conference in July. This culminated in Trump and his family launching World Liberty Financial, a venture dedicated to trading in this space with the hopes of amassing $300 million in token sales.
"Bitcoin is the one asset that was always going to soar if Trump returned to the White House," said Russ Mould, investment director at AJ Bell.
Following the recent surge, "the market is now speculating about 'when, not if, it will smash through $100,000,'" he said.
Why Is Bitcoin Surging Due to Donald Trump?
The optimism surrounding Trump's pro-crypto stance has energized the digital asset community, who anticipate more lenient regulations under his administration.
Trump has expressed intentions to replace current SEC Chair Gary Gensler, who has led a rigorous crackdown an industry most governments are still struggling to regulate.
A 2023 Pew Research Center survey found that just 17 percent of U.S. adults have ever bought cryptocurrency, most of them men under 50.
"Tonight the crypto voter has spoken decisively—across party lines and in key races across the country," said Brian Armstrong, CEO of Coinbase, one of the largest cryptocurrency exchanges.
"Americans disproportionately care about crypto and want clear rules of the road for digital assets. We look forward to working with the new Congress to deliver it," he posted on X, formerly known as Twitter.
A 'Light Touch' Approach to Crypto Regulation
Market analysts remain divided on the long-term implications of Trump's win for the crypto market.
While some investors see the potential for explosive growth, others warn about the market's notorious volatility. The space has experienced peaks and troughs throughout the NFT bubble and COVID-19, where Bitcoin wasn't worth even 10 percent of what it is now.
"Investors should only dabble in crypto with money that they can be prepared to lose," said Susannah Streeter, head of money and markets at Hargreaves Lansdown. "Because we've seen these wild swings in the past," she added.
Many crypto advocates, who view the existing regulatory environment as restrictive, hope that Trump's presidency could include a "light touch" approach.
She agreed that crypto enthusiasts would prefer a to see this as Trump's presidency takes shape.
"They want the sheen of legitimacy to be brought to crypto, but they don't want regulations to be too onerous to stop opportunities and innovation."
Will Bitcoin Reach $100,000?
Crypto enthusiasts are now speculating on whether Bitcoin's momentum could push its value to $100,000. Bitcoin has already gained 77 percent this year, and given recent developments, investors are increasingly bullish on digital assets.
"Trump has already declared his love of the digital currency and crypto traders now have a new narrative by which to get even more excited about where the price could go," said Mould.
Until then, Bitcoin's continued rise depends on whether Trump can follow through on promises to make the U.S. more crypto-friendly. His most prominent supporters in tech, inlcuding Musk, who donated $119 million to fund a super PAC aimed at securing his reelection, will likely be around to advise.
"The people of America gave @realDonaldTrump a crystal clear mandate for change tonight," he wrote on the social media platform X as Trump emerged ahead in the polls.
"America is a nation of builders. Soon, you will be free to build."
This article includes reporting from The Associated Press
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