3 Reasons Why Bitcoin Price Is Rising Today

by

As an analyst with over two decades of experience in the financial markets, I have witnessed numerous bullish and bearish trends that have shaped the industry we know today. The recent surge in Bitcoin price to $103K is undeniably one of the most significant events in the crypto space this year.

The cost of a single Bitcoin has surpassed the highly anticipated benchmark of $100,000, reaching a record-breaking high of $103,850. This remarkable leap in value can be attributed to the forthcoming appointment of pro-cryptocurrency advocate Paul Atkins as the next chair of the US Securities and Exchange Commission (SEC), following Gary Gensler’s departure on January 20th. Additionally, increased institutional buying and robust investments into BlackRock Bitcoin ETF (IBIT) have sparked this new all-time high for Bitcoin.

Three Reasons Behind the Bitcoin Price Rally to $103K

1. Donald Trump Appoints Paul Atkins As Next US SEC Chair

On December 4th, Wednesday, Donald Trump officially declared that Paul Atkins will assume the role of US SEC Chair, replacing Gary Gensler. The nomination of pro-cryptocurrency Atkins ignited a robust surge in Bitcoin’s price and the broader crypto market. This positive development has instilled optimism within the cryptocurrency sector, as they anticipate pro-crypto policies to emerge in the US soon.

As an analyst, I can’t help but share my excitement over the recent development, which has been hailed as a significant victory for the cryptocurrency industry by both Ripple CEO Brad Garlinghouse and US Senator Cynthia Lummis. Garlinghouse expressed his belief that the appointment of Philip Atkins to the SEC will bring a much-needed dose of ‘common sense’ to the agency. In response, Ripple’s Chief Legal Officer Stuart Alderoty echoed these sentiments, expressing optimism about the potential impact of this decision on the industry.

The team of Atkins, Peirce, and Uyeda at the SEC is expected to restore a practical approach to the agency, not just ordinary common sense, but also robust protection for investors.

Nonetheless, there are several unanswered queries that the incoming SEC Chair will need to address. It’ll be intriguing to observe if Paul Atkins collaborates with the U.S. administration in establishing a strategic Bitcoin reserve for the nation.

2. BlackRock Bitcoin ETF Crosses $50 Billion AUM Supporting Bitcoin Price Rally

The iShares Bitcoin Trust ETF from BlackRock, known as IBIT, has reached an impressive landmark: managing assets worth $50 billion. This achievement is backed by robust investments and a significant rise in the price of Bitcoin to $100K. Notably, it took only 228 days for the BlackRock Bitcoin ETF to reach this milestone after its launch.

Eric Balchunas, a strategist at Bloomberg ETF, pointed out that the rapid growth of IBIT (Invesco Blockchain ETF) is exceptional, as no other ETF has reached $50 billion so quickly. The iShares Core MSCI EAFE ETF ($IEFA), which previously held this record, took more than five times longer, approximately 1,329 days. This rapid achievement underscores the increasing interest in Bitcoin and bolsters IBIT’s influence within the market. Furthermore, traditional funds managed by BlackRock have been seeking exposure to IBIT during recent months.

The BlackRock Bitcoin ETF (IBIT) has been single-handedly driving all inflows into US Bitcoin ETFs this week. Just in the first three days of the week, IBIT has netted more than $1.6 billion in net inflows taking its total inflows since inception to more than $33 billion. For reference, its immediate competitor Fidelity’s FETH is one-third in size with $11.5 billion in inflows.

3. Russian President Vladimir Putin Recognizes Bitcoin

Today’s surge in Bitcoin price is fueled by increasing global acceptance of the asset class. In a speech at the Russia Calling Investment Forum in Moscow on Wednesday, Russian President Vladimir Putin expressed his strong endorsement for Bitcoin and digital currencies. He underscored that attempts to ban Bitcoin are futile and these technologies will persistently expand, as Putin stated: “Nobody can prohibit Bitcoin.

Since these are innovative technologies, their advancement isn’t contingent on the dollar’s status. Regardless of its fluctuations, these tools will continue evolving due to the universal drive for cost reduction and improved reliability.

BTC Becomes A $2 Trillion Asset

After Bitcoin’s recent price surge to a record high of more than $103,000, its market value exceeded $2 trillion for the first time ever. This means that Bitcoin is nearly on par with tech giants like Alphabet and Amazon in terms of value, potentially placing it among the top five most valuable global assets globally.

There’s been a substantial increase in long positions for Bitcoin futures, accompanied by a dramatic rise of 81% in the funding rate. Moreover, the daily trading volume of BTC has soared by 50%, exceeding $100 billion, suggesting robust optimism among investors.

Large Bitcoin futures investments have pushed the price of Bitcoin over $100,000, with the funding rate reaching an impressive 81% annually!

— 10x Research (@10x_Research) December 5, 2024

Additionally, data from Coinglass indicates a significant increase in 24-hour liquidations, amounting to approximately $171 million. Out of this total, around $130 million is attributed to short positions and the remaining $41 million represents long positions. Optimistic investors anticipate that the Bitcoin price surge might extend up to $120,000 by the close of December.

Read More

2024-12-05 08:30