Bitcoin Continues to Set New Records: Market Excitement Drives BTC to the $90,000 Mark
Bitcoin has continued its upward trend in recent days, reaching a new record level of $89,492. This surge has created a wave of excitement in the markets, leading to increased profit-taking among investors. As BTC approaches the $90,000 level, analysts are warning of the potential for a price pullback.
Singapore-based cryptocurrency trading firm QCP Capital has highlighted that the market is overly optimistic, emphasizing the risks associated with the heavy use of leverage. High funding rates are seen as an indication of overly loaded positions, which brings the risk of liquidations following a slight decline.
Bitcoin's rapid short-term rise is not solely attributed to Trump-related narratives, according to some experts. Analysts point out that the supply shock created after the halving has contributed to the price increase. BTC's supply significantly decreased with the halving of block rewards in April, indicating that demand is struggling to keep up with the current supply. The launch of Bitcoin exchange-traded funds (ETFs) is also fuelling this demand. Recent data shows that 13,940 BTC were purchased in one day, while only 450 BTC were mined, demonstrating a very high level of demand. Moving forward, investors are urged to remain cautious about the possibility of a bubble forming in the market.
The enthusiasm in the cryptocurrency markets continues as Donald Trump's policies, following his election as President of the United States, have provided significant support to cryptocurrencies and related stocks. Trump's strong backing of cryptocurrencies during his campaign, his promise that the U.S. would become the "crypto capital of the planet," and his pledge to establish a national Bitcoin reserve have created a positive atmosphere among investors. Although the details of these commitments are not yet clear, they have increased interest in crypto mining and trading.
The excitement in the markets following Trump's presidential victory has led to significant gains not only for Bitcoin but also in the altcoin market, particularly for Ethereum and Dogecoin. Cryptocurrency mining companies have also benefited from this positive sentiment, experiencing notable increases. Riot Platforms (RIOT) recorded a 17% rise on Wall Street and continued to climb in after-hours trading. Other mining companies like Marathon Digital Holdings (MARA) and CleanSpark (CLSK) also saw remarkable increases.
On another note, global software company and leading Bitcoin investor MicroStrategy announced yesterday that it purchased $2 billion worth of Bitcoin. Following this announcement, the company's shares surged by 26%, creating a positive impact in the markets. These developments indicate that the cryptocurrency market has found significant support as it enters the Trump era.
Cryptocurrency investors are anticipating a positive change in the regulatory environment, expecting the Trump administration to appoint a more crypto-friendly figure to replace SEC Chairman Gary Gensler. Furthermore, Trump’s announcement of his own crypto initiative, World Liberty Financial, has further solidified his commitment to the sector. Keyrock's Asia-Pacific Business Development Head, Justin D'Anethan, noted that these developments are not merely a price rise, but indicate that the market is beginning to view Bitcoin as a more stable and politically preferred asset.