Bitcoin Nears $90,000; Analysts Predict $100,000-$200,000 Target

Bitcoin’s recent rally continued through Monday night, hitting a peak of $89,599 early Tuesday. Investors seem energized by President-elect Donald Trump’s positive stance on cryptocurrency and his plans to revamp crypto regulations.

Since the U.S. election on November 5, Bitcoin has jumped about 32% in value. Some experts are even predicting it could break the $100,000 mark before the end of the year. "Bitcoin is now in price discovery mode," said H.C. Wainwright analyst Mike Colonnese in a CNBC report, meaning the market’s trying to find out just how high Bitcoin could go.

This recent spike has created a wave of optimism in the crypto world. Bernstein analysts are sticking with their long-term prediction that Bitcoin could hit $200,000 by 2025, thanks to what they expect will be crypto-friendly policies under Trump. "We think Trump’s administration will support crypto, starting with a pro-crypto SEC," noted Bernstein’s Gautam Chhugani and his team. Even with Bitcoin around $81,000, they see the outlook as positive for the next year.

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Trump’s push to make the U.S. a global leader in crypto is adding fuel to the fire. He’s talking about setting up a national Bitcoin reserve and incentivizing domestic mining, which is a big shift from President Joe Biden’s more cautious approach to regulation.

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According to H.C. Wainwright’s Colonnese, "We expect positive momentum to continue through 2024, with Bitcoin possibly reaching six figures by year-end."

"This is clearly a ‘Trump trade’ based on his strong support for crypto, which is likely to boost demand for both cryptocurrencies and related stocks," said Nick Twidale, chief market analyst at ATFX Global in Sydney.

Bitcoin was already close to record highs when Trump won the election, creating a ripe environment for growth. During his campaign, Trump promised to make the U.S. the “crypto capital of the world” and build a national Bitcoin stockpile.

Bitcoin’s surge has also lifted the total crypto market valuation to an all-time high of around $3.1 trillion. Chris Weston, head of research at Pepperstone Group, summed up the situation for investors: “For those not in the market yet, there’s a tough choice—either jump in now or wait for a pullback that might ease some of the excitement.”

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Institutional interest is also climbing, with MicroStrategy recently buying 27,200 Bitcoin for around $2 billion. Data from Deribit, a crypto options exchange, shows that many investors are betting Bitcoin will top $100,000 by the end of the year, according to Bloomberg.

Still, while the excitement is high, some analysts are advising caution given Bitcoin’s sharp rise. Bloomberg reports that a “short-term neutral approach” might be wise for now.

Trump’s focus on building a crypto-friendly regulatory environment has fueled what’s being called a broader “Trump trade,” which is boosting not only Bitcoin but also U.S. stocks and the dollar, all driven by his focus on economic growth and domestic investment.

Earlier, on November 6, Bitcoin jumped 8% in one day, setting a new all-time high of $75,000 as Trump’s election victory became clear.

"This isn’t just about the price," said Justin D'Anethan, head of Asia-Pacific business development at digital assets firm Keyrock. "It signals a shift towards seeing Bitcoin as a potentially stable and even politically supported asset."