Bitcoin reaching a price of $100,000 marks a significant moment for the cryptocurrency world, transitioning from a vision of cypherpunks to becoming more widely accepted in the financial industry.
Bitcoin was once considered a niche investment for a small group of technology enthusiasts and privacy advocates. However, its value has steadily increased over the years, reaching $1 in 2011, $1,000 in 2013, and now surpassing six figures in 2024.
The recent increase in value of Bitcoin shows how it has transformed from an experimental concept to a recognized and valuable financial asset on a global scale.
However, reaching $100,000 was not easy for cryptocurrency, as it faced many obstacles and setbacks. People have claimed that cryptocurrency is doomed numerous times, but it has always managed to recover and increase in value.
According to Mikko Ohtamaa, co-founder of the algorithmic trading company Trading Strategy, there is a limited window of opportunity over the next two to three years to demonstrate the positive impact that cryptocurrency can have on the world. He believes that this is a critical moment to show that crypto has the potential to make a significant difference, and he is optimistic about the current momentum in the industry.
Over the past decade, there has been a lot of guessing and predicting about the future of the market. It is now important to move from just guessing to actually using and benefiting from the technology. The current surge in market activity is unique because of certain distinct factors.
Bitcoin is currently seen as more than just a risky investment, as many consider it a reliable store of value, a protection against rising prices, and a legitimate asset category that is gaining traction among institutional investors.
Origin: Cynthia Lummis
Exchange-traded funds (ETFs) that focus on cryptocurrencies are now easier to access in countries like the United States and Hong Kong. The election of President Donald Trump, who is supportive of cryptocurrencies, has created a favorable environment for the cryptocurrency industry.
Associated: Report predicts that the adoption of cryptocurrencies will reach 8% by 2025.
During his campaign, Trump vowed to nominate a new Securities and Exchange Commission Chair to replace Gary Gensler, who is viewed as a controversial figure in the cryptocurrency community because of his tough stance on enforcement.
Investors are optimistic that this change could lead to less obstacles in regulations, creating a more welcoming atmosphere for cryptocurrency assets. Gensler's time in office, characterized by a strategy of enforcing regulations after the fact, has been heavily scrutinized by the industry for its lack of clear legal guidelines.
The road to reaching $100,000 in value for Bitcoin began with a single significant market drop. The journey has been far from straightforward, characterized by unpredictable price fluctuations, sudden market crashes, and periods of uncertainty about its future.
One of the most significant moments of struggle for Bitcoin was when its value dropped from $1,000 in 2013 to $200 in 2014. The collapse of Mt. Gox, which was the biggest Bitcoin exchange at the time, had a major impact during this period. Even now, ten years later, the payouts to Mt. Gox creditors are still being discussed.
Bitcoin rose to almost $20,000 in December 2017 due to the popularity of initial coin offerings (ICOs). However, the US started regulating ICOs as unregistered securities and China prohibited them completely. As a result, Bitcoin's value dropped to $3,200 by December 2018.
A recent study found that 80% of Initial Coin Offerings (ICOs) carried out in 2017 were
In 2021, Bitcoin experienced a significant increase in value, reaching $63,000, with support from institutions and well-known companies like Tesla, led by Elon Musk.
Origin: Arkham Intelligence
However, excitement was diminished once more due to government regulations: China implemented restrictions on Bitcoin mining, causing the price to sharply decline to $29,000. After reaching a new peak of $69,000 in November 2022, Bitcoin fell to a low of $15,000 amidst turmoil in the wider cryptocurrency industry caused by FTX's failure, Three Arrows Capital's collapse, and the crisis involving the Terra-Luna stablecoin.
As of 2024, Bitcoin has experienced a significant increase in value. The approval of spot Bitcoin ETFs by the SEC in January has allowed for more people to participate in trading, and the election of Trump in November has further boosted the rally.
According to market analyst Justin d'Anethan, Bitcoin is currently being driven by factors such as increased accessibility through ETFs, corporations investing in it, and institutions around the world increasing their allocations to it. Additionally, the shift away from the US dollar in BRICS economies is also contributing to Bitcoin's appeal as a potential hedge against traditional reserve currencies in a changing global economic landscape.
Why is reaching $100,000 significant for Bitcoin?
To Bitcoin enthusiasts, $100,000 holds more significance than just being a numerical value. It serves as a psychological milestone that confirms the dedication and belief in Bitcoin that has been shown over the years through trends like the "laser eye" profile picture movement on social media.
However, according to d'Anethan, reaching $100,000 is not the ultimate objective.
"In the last year, the increase in Bitcoin's value has been mainly influenced by experienced investors. This includes corporate treasuries, such as MicroStrategy, ETFs, and pension funds who have quietly started investing in BTC."
"Individual investors have not yet invested heavily, but once they do, the excitement will not end at $100,000." Trump's team also suggested the concept of a Bitcoin reserve for strategic purposes, which has received a range of responses.
Author: Ed Krassenstein/Impure Hoonter
There are differing opinions on whether this is a step towards centralization or if it is neutral to Bitcoin's decentralized principles, with Quary from Bitcoin marketplace Magisat taking the latter stance.
According to Quary, the individual who owns Bitcoin does not have a significant impact on the network.
I hope that both the United States and the BRICS countries (Brazil, Russia, India, and China) share an interest in Bitcoin and have significant investments in it. In my opinion, the ideal situation would be a decentralized network where all parties can participate without bias.
What is the future of Bitcoin? While reaching $100,000 is a significant milestone, for many, it represents the start of a bigger story for Bitcoin.
In the coming months, as the US Federal Reserve is expected to continue lowering interest rates, Bitcoin may benefit from a positive overall economic climate for high-risk investments.
According to d'Anethan, if there are no major sell-offs due to bankruptcies in 2022 or unexpected events, it appears that the easiest path for the market is upward.
Nevertheless, looking at past events, Bitcoin's path is usually not a steady increase. Pullbacks are anticipated, even during times of positive progress.
Article: Artificial intelligence (AI) technology may currently consume more energy than Bitcoin, which poses a potential threat to Bitcoin mining
With changing economic dynamics and evolving financial strategies, Bitcoin has shifted from being a specialized investment to a legitimate option for financial transactions.
Bitcoin reaching $100,000 is a strong indication that cryptocurrency is becoming more established and accepted. This digital currency is seen as a way to protect against inflation, a secure asset, and a representation of financial independence. Despite its unpredictable nature and intricate features, cryptocurrency is proving to have the ability to bring about significant changes in the financial world.