Bitcoin Rally Fueled by Trump Slows as Year Draws to a Close

The surge in Bitcoin, triggered by the election victory of US President-elect Donald Trump in early November, is now losing steam as we approach the end of 2024.

As of 6:34 a.m. on Monday in New York, the cryptocurrency was trading around $93,670, nearly $15,000 below the all-time high it achieved in mid-December. Smaller cryptocurrencies, such as Ether and the widely discussed Dogecoin, are also struggling to gain traction.

Read: Bitcoin pullback deepens after token’s record-breaking rally

Trump’s push for crypto-friendly regulations and his proposal for a national Bitcoin reserve has been a boon for digital assets.

Nonetheless, decreased expectations for interest rate cuts from the Federal Reserve have tempered speculative enthusiasm.

Further clarity on US cryptocurrency regulations is expected once Trump takes office on January 20. His strategies contrast sharply with those of President Joe Biden’s administration, which has enacted stricter regulations in this controversial sector.

Chris Weston, head of research at Pepperstone Group, commented that “the momentum has fizzled out from the post-election shift” in Bitcoin, in part because of outflows from cryptocurrency-related exchange-traded funds.

Meanwhile, MicroStrategy Inc., originally a software firm but now a Bitcoin investor, has been on a buying spree in recent weeks. Market watchers are eager to see if the company, which holds over $40 billion worth of Bitcoin, will maintain its pattern of announcing acquisitions on Mondays.

Bitcoin has appreciated approximately 120% this year, outperforming traditional investments such as global stocks and gold.

Additionally, Bitcoin more than doubled in 2023, marking a significant recovery from a lengthy bear market.

© 2024 Bloomberg

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