Bitcoin traders' next mark: bitcoin at $100,000
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Bitcoin hit a new record on election night, but traders are placing bets on a much bigger number by the end of the year: bitcoin at $100,000.
Why it matters: A six-figure price for the world's original cryptocurrency would turn 2024 from a modest bull market into an outright boom.
By the numbers: $100,000 is the most popular price for bitcoin call options on Dec. 27, the last closing date of the year on Deribit, the leading options exchange in the sector. The contracts have a notional value of $648 million.
- That means traders are betting the price will be even higher as 2024 comes to a close.
- Across all closing dates, there's a notional value $1.26 billion in call options at $100,000.
Context: With bitcoin trading Wednesday at nearly $74,600, a six-figure price would mean at least a further 34% gain. It's already up 17% over the past 30 days as investors increasingly piled into a bet on Donald Trump regaining the White House.
Zoom out: The bull run isn't just about the election of an openly pro-crypto president and Trump's promise of crypto "going to the moon," however.
- Fadi Aboualfa, head of research at digital asset custodian Copper.co, said its models suggest $100,000 bitcoin is "quite possible" by the time the next president is sworn in based just on the trend line of ETF accumulation.
Bitcoin's new all-time high Tuesday night broke the record set in March.
- Trump's win cemented what was already a nascent crypto bull run led by other political developments in the U.S., including the approval of those bitcoin exchange-traded funds.
Between the lines: Other pieces seem to be falling into place for strong growth for bitcoin too.
- Pro-crypto candidates won seats in Congress on both sides of the aisle last night.
- The Trump administration is likely to sit on bitcoin seized from convicted criminals, while also removing the industry's number one opponent, SEC chair Gary Gensler.
- Over the last two presidenital elections, bitcoin price has seen a strong surge in the near term after the election.
- And behind all that, the bitcoin halving took place in April, diminishing the daily production of new supply, which, historically, has led to a strong surge in price a year or so after the cut kicks in.
What we're watching: If the Republican party attains a sweep of Congress and the White House, the U.S. Government could go even further than holding onto seized bitcoin.
- "The GOP's commitment to clear crypto regulations and making Bitcoin a strategic reserve asset is set to be a game-changer for industry growth," CoinShares CEO said Jean-Marie Mognetti said in a statement.
- In particular, CoinShares noted the improved prospects for Sen. Cynthia Lummis's (R-Wyo.) Bitcoin Act, which sets the government up as a buyer of the asset.
Flashback: In the last true crypto boom of 2021, bitcoin diehards on Twitter modified their profile photos with laser eyes, signaling their expectation that the original cryptocurrency would break six-figures.
- They were disappointed, with price falling far short, with a high that year just below $70,000.
- But those who held on to their bitcoin (if not to their modified avatars) may yet see their determination pay off.
