Bitcoin, the world’s largest cryptocurrency, surged past $87,000 for the first time on Monday, reaching $87,083 by mid-afternoon, according to CoinDesk. This record-breaking rise reflects a 28% increase over the past week, a surge attributed to renewed enthusiasm in the cryptocurrency sector following Donald Trump’s U.S. presidential victory last week.
Trump’s Support Boosts Crypto Market
Analysts link this rally to optimism surrounding a potentially “crypto-friendly” administration under Trump. Known for his recent embrace of cryptocurrency, Trump has signaled intentions to position the U.S. as a global hub for digital assets. His plans include creating a strategic bitcoin reserve and easing regulations, raising hopes for a more favorable crypto environment.
Institutional Inflows Drive Gains
Institutional interest has also spiked, with significant investments funneled into new spot bitcoin ETFs since their approval in January. Citi analysts reported record inflows into these funds in the days following the election, underscoring their role in driving up bitcoin’s value.
The Volatile Nature of Crypto
Despite the current momentum, experts caution that crypto assets remain highly volatile. Bitcoin’s value, for example, has experienced drastic fluctuations from a pandemic low of $5,000 to nearly $69,000 in 2021, followed by steep drops due to regulatory pressures and the 2022 FTX collapse. Investors are advised to stay cautious, as the market remains unpredictable.
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