Bitcoin has shattered records, reaching an all-time high of $85,000, positioning itself just 17.6% away from the coveted $100,000 mark. This new milestone, achieved on November 10, underscores the significant impact of former President Donald Trump’s recent reelection, which has reignited investor confidence in the cryptocurrency market. Analysts are now predicting that Bitcoin could breach six figures by the end of 2024, driven by renewed market optimism, institutional interest, and pro-crypto sentiment in Washington.

Trump’s Victory Sparks Market Optimism

Trump’s second term is widely seen as a positive development for the crypto industry, with many expecting a regulatory shift that could foster blockchain innovation and provide much-needed clarity for digital assets. The Republican-controlled Senate is also anticipated to champion crypto-friendly policies, which, according to Coinbase CEO Brian Armstrong, marks “the most pro-crypto Congress ever.”

Ryan Lee, chief analyst at Bitget Research, noted that Trump’s win has sparked a wave of risk-on behavior among investors, with Bitcoin seeing a surge in demand. He explained, “The US election outcome has paved the way for Bitcoin to potentially surpass $100,000 before the end of the year.” Lee also pointed to heightened volatility in Bitcoin derivatives and a growing influx of funds into the futures market as signs of positioning for a major rally.

Institutional Investment: BlackRock’s ETF Leads the Charge

Institutional inflows have played a significant role in Bitcoin’s recent surge, especially following the success of BlackRock’s Bitcoin ETF. On November 7, BlackRock’s iShares Bitcoin Trust ETF (IBIT) attracted over $1 billion in inflows in a single day, representing nearly 82% of all inflows across US-listed spot Bitcoin ETFs. This renewed institutional interest signals growing confidence in Bitcoin as an investable asset among large financial players.

Following BlackRock, Fidelity’s Wise Origin Bitcoin Fund and ARK’s 21Shares Bitcoin ETF also saw substantial inflows, totaling $190.9 million and $17.6 million, respectively. These developments illustrate a strong appetite for Bitcoin among traditional investment firms, further driving up demand and likely contributing to the record-breaking prices.

Republicans Poised to Shape Crypto Regulation

The crypto industry is optimistic that a Republican-led Senate could be more open to creating a supportive regulatory framework for digital assets. Wyoming Senator Cynthia Lummis, a known Bitcoin advocate, has already announced plans to pursue a strategic Bitcoin reserve for the United States. Lummis’ “Bitcoin Act,” introduced in July, proposes that the US government acquire up to 1 million BTC (approximately 5% of the total supply) and hold it as a long-term asset.

This potential government endorsement, coupled with Trump’s pro-crypto stance, is expected to set the stage for groundbreaking policies that could boost adoption and support the growth of US-based crypto companies.

BTC Target of $100,000 on the Horizon?

With Bitcoin’s price now hovering around $85,000, the question on everyone’s mind is whether it can hit $100,000 by year’s end. Technical analysts are pointing to bullish patterns, including a long-term cup-and-handle setup, which has a high probability of success during bullish conditions. Independent trader Titan of Crypto estimates a potential breakout to $110,000 based on this setup, representing a 47% ROI from the current price.

Furthermore, the Bitcoin derivatives market is signaling high volatility ahead, with many traders increasing leverage in anticipation of a substantial price move. The market capitalization of stablecoins, currently at $160 billion, is also providing liquidity that could accelerate Bitcoin’s path to six figures.

Global Developments: Crypto Regulations, Pension Funds, and Central Banks

The US isn’t the only country making moves in the crypto space. Recently, Pakistan proposed policy changes to recognize digital assets as legal tender. If approved, the State Bank of Pakistan could issue a digital rupee, paving the way for a Central Bank Digital Currency (CBDC). The new regulations aim to legitimize digital assets and integrate them into Pakistan’s financial system, which would mark a major step toward global crypto adoption.

In the US, Michigan’s State Retirement System has added Ether to its portfolio, signaling institutional confidence in crypto beyond just Bitcoin. In a recent SEC filing, the pension fund disclosed holdings in both Bitcoin and Ethereum ETFs, showing a diversified approach to digital assets.

Risks and FUD in the Market

Despite the bullish momentum, the market is not without risks. Bitcoin’s relative strength index (RSI) shows that it is in overbought territory, suggesting that profit-taking could occur in the short term. Meanwhile, the FTX bankruptcy estate’s lawsuit against Binance is adding to uncertainty in the market, with allegations of fraud and market manipulation in connection with FTX’s collapse.

In addition, regulatory scrutiny remains high. California recently revoked BlockFi’s lending license, signaling a tough stance on crypto lending practices even as the industry seeks regulatory clarity. This action serves as a reminder that, while crypto is gaining acceptance, oversight is also increasing.

What’s Next?

The recent rally highlights Bitcoin’s resilience and growing status as a mainstream investment. If the pro-crypto policies expected from the Republican-controlled Senate materialize, it could pave the way for further price increases, potentially making the six-figure Bitcoin a reality sooner than anticipated.

As institutions like BlackRock and Fidelity continue to invest, and with a US administration supportive of blockchain, the future of Bitcoin looks increasingly promising. However, market volatility, regulatory developments, and potential profit-taking could add to fluctuations in the short term. Investors will be watching closely as Bitcoin approaches the $100,000 threshold, a psychological milestone that could reshape perceptions of cryptocurrency worldwide.