Bitcoin Is on the Cusp of Topping Record High Reached in March
(Bloomberg) -- A sharp increase in Bitcoin's value has brought the first cryptocurrency close to breaking its all-time high of nearly $74,000 attained in March.
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The digital asset reached a peak of $73,564 on Tuesday in New York, but then dropped below $73,000 during the early hours of Wednesday in Asia. This surge also benefited smaller cryptocurrencies like Ether and the popular meme token Dogecoin.
Some people see Bitcoin as a "Trump trade" because Donald Trump, the Republican presidential nominee, has shown support for digital currencies during his campaign. Currently, Trump is leading in prediction markets, while surveys indicate a tight competition between him and Democratic candidate Vice President Kamala Harris.
According to Tony Sycamore, a market analyst at IG Australia Pty, the token is still reflecting the possibility of a Donald Trump election win. He noted that for Bitcoin to gain more confidence in its ability to surpass the record high of $73,798 set in March, it must consistently break through the $70,000 mark.
Trump has promised to turn the United States into the leading hub for cryptocurrency worldwide. In contrast, Harris has taken a more cautious stance, committing to establish a supportive regulatory system for the industry. These viewpoints are notably different from the stricter measures implemented by President Joe Biden's administration against the sector.
Trump has mentioned that he plans to enlist billionaire Elon Musk, a significant supporter of his campaign, to lead an initiative aimed at reducing government expenditures. This initiative is dubbed the Department of Government Efficiency (DOGE), drawing inspiration from the Dogecoin cryptocurrency that Musk has been known to promote.
According to Arisa Toyosaki, co-founder of Cega, a crypto derivatives service, Musk's connection to the Trump campaign boosted traders' optimism.
Options traders are ramping up their wagers that Bitcoin could hit a high of $80,000 by the end of November, regardless of the election outcome. As Election Day approaches on November 5, implied volatility is on the rise. In the US, spot-Bitcoin ETFs have seen approximately $3.6 billion in net inflows this month.
Recently, Bitcoin has managed to hold its ground against reduced expectations for interest rate cuts from the Federal Reserve, along with news of increased US oversight of Tether, a stablecoin that plays a crucial role in cryptocurrency trading. So far in 2024, Bitcoin has surged by around 73%.
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