As expectations grow for pro-crypto President Donald Trump to be inaugurated for a second term, Bitcoin is gaining momentum, poised for its biggest weekly gain since the US election week in November.
The world’s largest cryptocurrency by market cap is up nearly 12% since Sunday, to $104,668, for a 4.96% gain on the day. The rally comes after a mixed performance that has seen Bitcoin decline in three of the last four weeks. BTC previously reached an all-time high of $108,315 in December.
Chart with 15-minute candles showing the rise of
BTC price.
“The market is now pricing in Trump taking office and Trump being bullish on crypto,” said Zaheer Ebtikar, founder of crypto fund Split Capital.
Trump plans to issue an executive order prioritizing BTC as part of his administration’s policy agenda, according to Bloomberg. The order is expected to prompt a more inclusive dialogue with industry leaders and signal a shift from his previously skeptical stance on cryptocurrencies.
This week’s Bitcoin rally coincided with a broader rally in risk assets as inflation concerns in the U.S. eased. Weaker-than-expected Producer Price Index (PPI) and Consumer Price Index (CPI) data renewed investor optimism for further rate cuts from the Federal Reserve.
“The lower PPI and CPI have removed macro concerns, allowing investors to focus on crypto-specific catalysts,” said Jake Ostrovskis, a trader at Wintermute, a crypto market-making firm.
But Ostrovskis warned of potential volatility in the market as Trump’s inauguration approaches. “The options market is showing that traders are betting on higher volatility in late January, which means the market could be running ahead of Monday’s inauguration,” Ostrovskis added.
*This is not investment advice.
