Bitcoin more than doubled in 2024, boosted by the US market regulator’s approval of exchange-traded funds (ETFs) for its spot price and growing optimism over reduced regulatory hurdles as Donald Trump returns to the White House. Preparing to go.
Last month, the world’s largest cryptocurrency crossed the $100,000 mark, a historic achievement that has ignited the ‘animal spirits’ among proponents of this now mainstream asset class.
According to data from CoinGecko, a more than 120 percent increase in Bitcoin in 2024 and a nearly 50 percent increase in Ether, the second-largest cryptocurrency, have pushed the sector’s market value to nearly $3.5 trillion.
According to analysts, further gains are expected by 2025.
“We believe that $100,000 is not the final milestone. We expect Bitcoin to reach a high of $200,000 in late 2025,” analysts at brokerage Bernstein wrote in a client note last month.
MicroStrategy, a software firm that has become the world’s largest corporate holder of bitcoin, sees its shares nearly fivefold in 2024.
The stock, which recently joined the benchmark Nasdaq-100 index, is now seen as a proxy for bitcoin, with its movements closely tied to sentiment toward the digital asset. Several smaller companies are following his playbook and allocating portions of their cash to Bitcoin.
“We expect bitcoin to emerge as a new era’s premier ‘store of value’ asset that will eventually replace gold over the next decade and become a permanent part of institutional multi-asset allocations and for corporate treasury management. will become a standard,” Bernstein noted.
Much of the optimism began in January when the U.S. Securities and Exchange Commission approved the first ETFs to track the spot price of bitcoin, a watershed moment for the broader crypto industry.
The move gave the sector institutional legitimacy and improved its mainstream appeal as traditional finance heavyweights including BlackRock and Fidelity launched products.
The victory of Trump, who has promised to make the United States the “crypto capital of the planet”, further strengthened the industry’s position at the end of the year. Crypto supporters donate millions during elections, hoping to elect candidates who favor the sector.
Most crypto stocks have also benefited from the industry-wide rally. The big winners of 2024 are MicroStrategy, crypto exchange Coinbase and bitcoin miner Hit8.
On the other hand, several other crypto miners have been weighed down by shrinking margins due to higher energy and hardware costs, missing out on the year’s rally.
Shares of Wright Platform, Marathon Digital and BitDigital fell between 26% and 32% last year.