(Bloomberg) — Bitcoin hit a record high for the second day in a row, with traders eyeing the $110,000 price level.
The native cryptocurrency rose as much as 2.1% to $108,315 on Tuesday before retreating to $106,000 early in the day. This year, the price has risen more than 150% and traders are increasing their bets on further gains in the options market.
“We have seen buyers at $110,000-$120,000 and $110,000-$125,000 call spreads in January, as well as rolling long strikes from $100,000/$105,000 to 120,000 strikes,” said Shiliang Tang, president of crypto. main trading firm Arbelos Markets.
Bitcoin reached the $100,000 milestone less than two weeks ago after newly elected President Donald Trump announced his plans to appoint crypto backer Paul Atkins as chairman of the U.S. Securities and Exchange Commission. Token prices have continued to rise as cryptocurrencies and crypto-related companies such as MicroStrategy Inc. have seen greater institutional acceptance.
“Since late last week and the announcement of MSTR’s inclusion in the Nasdaq 100, as well as MicroStrategy’s continued open market purchases of BTC, capital rotation has largely benefited BTC’s dominance, with BTC reaching ATHs and further pulling more capital out of the markets,” Tang said.
Crypto markets have seen big gains since Trump’s election victory as the industry expects a friendlier regulatory environment, and with Trump taking office next year, these tailwinds could continue.
“What is driving prices is the US election dividend, and in 2025 the prospects for the US to own Bitcoin as a strategic reserve (probably not priced according to Polymarket, which sees this as only a 27% chance of success), geopolitical instability, a looser monetary policy – these factors are likely to remain supportive in 2025,” said James Butterfill, head of research at CoinShares.
Other macroeconomic factors, such as Wednesday’s upcoming interest rate decision, are also contributing to Bitcoin’s recent price movements.
With these factors, the market appears to be entering a new phase of price discovery for Bitcoin, according to Chris Newhouse, director of research at Cumberland Labs.
“We have observed relatively neutral funding rates throughout, and positioning in derivatives that suggests some hesitation around new highs,” Newhouse said. “While it is difficult to say how quickly new catalysts – such as more structured regulation, stable compliance frameworks or even official government ownership – will be priced in, the stage is set for a reappraisal of crypto’s long-term potential that goes well beyond the recent rally .”
More stories like this are available at bloomberg.com
