Bitcoin hit a new all-time high of $107,000 this week, gaining nearly 6 percent. The rise coincides with President-elect Donald Trump's idea about establishing the Strategic Bitcoin Reserve, similar to the U.S. Strategic Petroleum Reserve. This has raised optimism across the crypto market and indicates that the regulatory authorities may embrace cryptocurrencies.
The cryptocurrency rise also came at the same time as expectations of another cut in interest rates by the Federal Reserve. These financial conditions usually push risk assets like Bitcoin. Further adding to the crypto market's resilience was the inclusion of MicroStrategy into the Nasdaq 100 index, a clear signal of institutional adoption of Bitcoin. Bitcoin is even more than its prior records as per CoinSwitch Markets Desk, ranked 7th largest asset by market capitalization.
A major development is including Bitcoin in large Exchange-traded funds (ETFs) with assets under management above $300 billion. However, Rahul Pagidipati, CEO of ZebPay, stated that the current market price puts Bitcoin in the top ten most valuable assets globally, surpassing many significant commodities and corporations. This valuation also includes the approval of the market usage of cryptocurrencies and the legalization of assets based on cryptocurrencies.
Tanvi Kanchan from Anand Rathi Shares and Stock Brokers also noted further implications of Trump's proposed Strategic Bitcoin Reserve and the rising corporate interest, signifying its entry into the mainstream market. Altogether, these factors suggest a favorable trend for the cryptocurrency market.
With Bitcoin aiming for the $110,000 mark, the market's trend looks bullish despite the negative predictions. Sathvik Vishwanath, the Co-Founder and CEO of Unocoin, said that the proposed reserve has solidified Bitcoin as a fundamental financial instrument. The cryptocurrency has risen over 50 percent since the U.S. election, demonstrating high currency adoption as a safeguard against fluctuating normal market trends.
The positive market sentiment is based on the beliefs of sustained institutional investment and favorable regulation changes. According to Pankaj Balani, the CEO of Delta Exchange, Bitcoin ETFs are now at 1% of all ETF assets, which hints at more growth. He highlighted the value of the extent of engagement in the market, with open interest close to record highs based on the expectation of other market players that the markets will continue to rise higher.