The price of Bitcoin reaching $100,000 marks a significant moment for the cryptocurrency industry, moving from its origins as a cypherpunk dream to becoming more widely accepted in the financial world.
Bitcoin, which was previously considered a niche investment for a small group of technology enthusiasts and privacy advocates, has experienced significant growth over the years. Its value has increased from $1 in 2011 to $1,000 in 2013, and it has now reached the highly sought-after six-figure milestone in 2024.
The recent rise in Bitcoin's value shows how it has transformed from an experimental concept to a recognized financial asset on a global scale.
However, reaching $100,000 was not an easy journey for the cryptocurrency. Despite being declared "dead" multiple times, it consistently managed to come back and increase in value.
Mikko Ohtamaa, the co-founder of Trading Strategy, believes that the next two to three years are crucial for demonstrating how cryptocurrency can have a positive impact on the world. He sees this as the final opportunity to show the potential of crypto, and believes that the industry is currently experiencing favorable conditions.
For the past decade, there has been a lot of guessing and predicting in the market. It is now important to move towards practical and tangible applications. This current surge in the market is notable for several distinct reasons.
Bitcoin is now seen as more than just a risky investment; it is considered a safe option for protecting against inflation and is recognized as a legitimate asset class that is gaining support from institutional investors.
Origin: Cynthia Lummis
Exchange-traded funds (ETFs) focused on cryptocurrencies have become more popular in countries like the United States and Hong Kong, making it easier for people to invest in them. The election of Donald Trump, who is supportive of cryptocurrencies, as the US president has provided a boost to the cryptocurrency industry.
In the near future, it is projected that the adoption of cryptocurrency will reach 8% by the year
During his campaign, Trump promised to appoint a new Securities and Exchange Commission Chair to replace Gary Gensler, who is viewed as a controversial figure in the cryptocurrency industry for his tough regulatory stance.
Investors are optimistic that this change could help decrease obstacles related to regulations, creating a more welcoming atmosphere for crypto assets. Gensler's time in office, characterized by a strategy of enforcing regulations, has faced criticism from the industry for not providing clear legal guidelines.
The road to reaching $100,000 with Bitcoin began with a significant market crash. The journey has not been straightforward, with unpredictable price fluctuations, sudden crashes, and moments of uncertainty about its future.
One significant moment of crisis for Bitcoin occurred 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 time and the process of repaying creditors is still ongoing even ten years later.
In December 2017, the price of Bitcoin increased to almost $20,000, largely due to the popularity of initial coin offerings (ICOs). However, government regulations became stricter, particularly in the US where ICOs were considered illegal securities offerings. China also prohibited ICOs altogether. By December 2018, the price of Bitcoin had dropped to $3,200.
A recent study found that 80% of Initial Coin Offerings (ICOs) that took place in 2017
Bitcoin experienced a significant increase in value in 2021, reaching a peak of $63,000. This surge was supported by the involvement of institutions and well-known companies like Tesla, led by Elon Musk.
Origin: Arkham Intelligence
However, excitement was quickly diminished by regulatory actions. China's crackdown on Bitcoin mining caused the price to plummet to $29,000. After reaching a peak of $69,000 in November 2022, Bitcoin fell to $15,000 due to various issues in the cryptocurrency industry such as FTX's collapse, Three Arrows Capital's downfall, and the crisis surrounding 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 allowed for more people to participate in trading, and Trump's election in November further boosted the rally.
According to market analyst Justin d'Anethan in Hong Kong, factors such as ETF availability, corporate investments, and increased interest from global institutions are driving the current growth of Bitcoin. Additionally, the move away from the US dollar in BRICS countries is also contributing to Bitcoin's appeal as a potential hedge against traditional reserve currencies in a changing global financial landscape.
What significance does $100,000 hold for Bitcoin? To Bitcoin enthusiasts, reaching $100,000 is more than just a numerical milestone. It represents a psychological checkpoint that confirms the dedication and belief in Bitcoin that supporters have shown over the years, as seen through the "laser eye" trend on social media.
However, as d’Anethan clarified, the ultimate objective is not just to reach $100,000.
"In the last year, the increase in Bitcoin has mostly been influenced by experienced investors such as corporate treasuries like MicroStrategy, ETFs, and pension funds. These entities have been quietly investing in Bitcoin without much attention," he explained.
Individual investors have not yet fully invested in Bitcoin, and once they do, the price increase will likely not stop at $100,000. Trump's team also mentioned the concept of a strategic Bitcoin reserve, which has received a variety of responses.
Author: Ed Krassenstein/Impure Hoonter
Some people see it as a step towards centralization, while others, such as Quary, the founder of the Bitcoin marketplace Magisat, believe it has no impact on Bitcoin's decentralized principles.
According to Quary, the ownership of Bitcoin does not have any impact on the network.
It is hoped that both the US and BRICS countries (Brazil, Russia, India, and China) share an interest in Bitcoin and have significant investments in it. This would be the ideal situation, creating an impartial decentralized network where all parties can participate.
What lies ahead for Bitcoin? While reaching $100,000 is a significant milestone, for many, it marks just the start of Bitcoin's broader narrative.
In the foreseeable future, as the US Federal Reserve is expected to continue reducing interest rates, Bitcoin may benefit from a positive overall economic environment for risky investments.
According to d'Anethan, unless there is a significant sell-off due to bankruptcies in 2022 or an unexpected event, the most likely direction for the market is upwards.
Nevertheless, looking at past events, Bitcoin's path is typically not a consistent upward trend. It is probable that there will be adjustments, even during periods of positive progress.
Publication: Artificial intelligence could be consuming more energy than Bitcoin, which poses a potential threat to Bitcoin mining operations.
With changes in economic powers and monetary policies, Bitcoin has gone from being a specialized asset to a realistic financial option.
Bitcoin reaching $100,000 is a strong indicator that cryptocurrency is becoming more mainstream and will continue to be a prominent player in the financial world. This rise in value can be seen as a way to protect against inflation, a secure asset in times of uncertainty, or a representation of independence from traditional financial systems. It highlights the volatility, intricacy, and ability to bring about significant changes that come with the