Bitcoin nears $90,000 as crypto market exceeds pandemic-era peak

Image credit: Chris McGrath/ Getty Images

Bitcoin stood on the verge of $90,000 on Tuesday, riding a wave of euphoria since the election of Donald Trump as US president on expectations his administration will be crypto-friendly.

The world’s biggest cryptocurrency has become one of the most eye-catching movers in the week since the election and touched $89,637 in Asia – a gain of more than 25 per cent since November 5.

It is surging along with Elon Musk’s automaker Tesla, which is up nearly 40 per cent since voting results rolled in as investors figure Trump’s friends and interests will do well while he is in office.

“Obviously (it’s) a clear Trump trade as he is so supportive of the industry, and this can only mean more demand both for crypto stocks as well as the currencies themselves,” said Nick Twidale, chief market analyst at ATFX Global in Sydney.

“The fact that bitcoin was trading near all-time highs when the election result came through meant that it had clean sky above.”

Trump embraced digital assets during his campaign, promising to make the US the “crypto capital of the planet” and to accumulate a national stockpile of bitcoin.

It needs to be clarified how or when that could happen but the possibility drove a speculative surge in crypto mining and trading stocks.

“I think it increases the chances that other nation states buy bitcoin in a bid to front run the US,” said Matthew Dibb, chief investment officer at cryptocurrency asset manager Astronaut Capital.

“Additionally, I think it would be a crazy catalyst for the US-listed Bitcoin miners … given possibilities of such entities getting nationalised.”

Crypto miner Riot Platforms jumped nearly 17 per cent on Wall Street overnight and rose further in after-hours trade. Fellow miners MARA Holdings and CleanSpark leapt nearly 30 per cent.

Software company and investor in bitcoin MicroStrategy announced it had spent about $2bn buying bitcoin between October 31 and November 10. Shares rose 26 per cent and were still gaining in after-hours trade.

The euphoria extended across the crypto landscape with smaller tokens such as ether ETH= and even one-time joke currency dogecoin having surged.

Crypto investors see an end to increased scrutiny under US Securities and Exchange Commission Chair Gary Gensler whom Trump has said he will replace. Trump also unveiled a new crypto business, World Liberty Financial, in September.

“What we’re seeing isn’t just a price milestone; it’s a signal that the market is warming to the idea of bitcoin as a more stable, even politically favoured, asset,” said Justin D’Anethan, head of Asia-Pacific business development at digital assets market maker Keyrock.

Read: GCC leaders congratulate Trump on historic election victory