As demand for the digital currency continues to rise following an election that witnessed victory for pro-crypto candidates lead by President-elect Donald Trump, the price of one bitcoin reached $100,000 for the first time on Wednesday.
The price of bitcoin has increased by about 45% since November 5. Prices have more than doubled so far this year.
The six-figure mark is the most recent profitable milestone for a digital currency that first appeared in a small whitepaper produced by an unidentified creator fifteen years ago. The concepts that author Satoshi Nakamoto outlined have subsequently given rise to a whole technological environment devoted to peer-to-peer transactions, which presently consists of trading platforms, NFTs, and hundreds of other digital tokens.
Nevertheless, cryptocurrencies have remained contentious. According to the FBI, a number of them, including bitcoin, have contributed to an increase in scams and cybercrimes that cost consumers billions of dollars last year.
As a result, many cryptocurrency initiatives are now viewed with skepticism by federal officials.
After the election, proponents of bitcoin are hoping that a new pro-crypto mindset will emerge in Washington that will end the stringent regulation and enforcement of digital tokens, allow traditional financial institutions to invest in bitcoin, and increase the profitability of mining bitcoin by boosting energy production.
Former cryptocurrency skeptic Trump has indicated interest in establishing a bitcoin “strategic reserve” in the United States, similar to those for gold and oil. Speaking at this year’s Bitcoin Conference in Nashville, Tennessee, during his third presidential campaign, he praised the inventiveness of the crypto community and promised to turn the United States into the global center of cryptocurrency if elected.
According to analysts, Bitcoin’s price fluctuations are still infamously erratic and are unlikely to alter regardless of who is in power.
However, it is indisputable that prices have increased with time. More lately, a significant portion of the demand driving that rise has gone toward exchange-traded funds, or ETFs, run by big financial institutions and tracking the price of bitcoin. The largest of these is BlackRock’s iShares Bitcoin Trust ETF.
According to an interview with Jay Jacobs, BlackRock’s U.S. head of thematic and active ETFs, the IBIT ETF has increased in value by $4.1 billion in the last month alone, and from its January inception, it has grown to a value of over $45 billion.
Jacobs noted that more investors worldwide and from a wider range of income levels are beginning to see bitcoin as a hedge against geopolitical risks, particularly inflation-driven currency devaluations, in addition to the election success of candidates that are more pro-crypto.
It’s only a matter of time until the general public’s interest in bitcoin hits a tipping point, according to Jacobs, as ETFs provide investors with a simple means of being exposed to price fluctuations.
“There’s growing interest across institutional or wealth-management space to learn, but it s always going to be a journey of education, and it takes time for that process for happen,” he stated.
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