What happened?
Bitcoin broke the $85,000 mark after Trump won the U.S. presidential election, setting a new historical high, reigniting market expectations for Bitcoin to break $100,000 by the end of the year.
Bitget Research analyst Ryan Lee stated that the results of the U.S. election have strengthened investors' bullish sentiment, while the open interest in the futures market and the volatility in the derivatives market further suggest that Bitcoin will experience significant price fluctuations. Additionally, the regulatory benefits brought by Trump and the Republican Party regaining power have also injected confidence into the cryptocurrency market.
Ryan Lee also pointed out that as the market capitalization of stablecoins continues to hit new highs, the demand for leveraged funds in the market has increased, further driving up the price of Bitcoin, which is likely to surpass the $100,000 target in the next three months.
The cryptocurrency market welcomes favorable policies, and Trump's victory may lead to a more friendly regulatory environment.
The news of Trump's election has excited many cryptocurrency industry practitioners.
Brian Armstrong, CEO of the largest U.S. exchange Coinbase, stated that the Republican Party's majority in the Senate represents the upcoming Congress will be "the most supportive Congress for cryptocurrencies in history."
Many believe that this Congress will promote more policies favorable to financial technology and blockchain innovation, reducing the regulatory pressure faced by cryptocurrency companies. Especially after Trump takes office, it is expected that there will be reforms to regulatory agencies that have previously attempted to suppress the cryptocurrency industry forcefully.
Michael Miller, an analyst at independent research firm Morningstar, pointed out that the Trump administration is likely to reduce regulatory pressure on the cryptocurrency industry, especially on the staking operations of cryptocurrency exchanges like Coinbase.
In other words, if there is indeed a policy shift in the future, it would not only be beneficial for Coinbase's business growth but is also considered an important factor driving the rise in cryptocurrency market prices. Coinbase's stock price rose 20% on November 11, breaking the $300 mark for the first time since 2021, making it one of the biggest beneficiaries of this election result.
Additionally, Michael Novogratz, CEO of another cryptocurrency company Galaxy Digital, stated that the day Trump was elected became the company's highest trading volume day of the year, indicating strong demand in the cryptocurrency market after the new government took office.
Massive inflows into Bitcoin ETFs accelerate price rises.
The massive inflow of funds into Bitcoin spot exchange-traded funds (ETFs) is also one of the reasons for the recent rise in cryptocurrency market prices.
According to foreign media (Cointelegraph), BlackRock's Bitcoin ETF attracted $1 billion in inflows on the first trading day after the election, showing a surge in institutional investor demand for Bitcoin.
Bitget Research analyst Ryan Lee pointed out that the spot ETF brings a large amount of capital into the market, which is not only a short-term factor pushing up Bitcoin's price but also enhances market liquidity.
Because this level of ETF investment represents institutional capital's recognition of Bitcoin, the entry of such investors usually brings stable long-term funding sources, further supporting the upward momentum of Bitcoin's price.
Therefore, Bitcoin's price volatility may intensify in the short term, but the stable demand brought by ETFs makes the market expect possibly larger upward potential.
Net inflows into Binance have exceeded $5 billion.
The cryptocurrency market is entering a bull market, and as the topic heats up, more and more users and funds are flowing into the market. Since November 5, Bitcoin's price has risen nearly 20%, while Ethereum (ETH) prices have surged by 30%.
And the world's largest cryptocurrency exchange, Binance, recorded $1 billion in inflows for two consecutive weeks. According to DeFiLlama data, Binance's net inflows in November have exceeded $5 billion, five times that of the second-largest platform's net inflows.
After the results of the U.S. presidential election were announced, investor attention to the cryptocurrency market gradually increased, with Binance recording over 13 million app visits in a single day on November 6.
Binance CEO Changpeng Zhao stated, "During major political events such as the U.S. presidential election, discussions surrounding cryptocurrencies are increasing, indicating that cryptocurrencies are playing an increasingly important role in shaping the future of finance and policy. We are indeed witnessing the golden age of cryptocurrencies, and their potential is being embraced and realized globally."
Driven by this trend, the asset holdings of Binance users have reached $130 billion, according to data from DeFiLlama, which is the highest user asset holdings since Binance launched proof of reserves two years ago.
References: cointelegraph, cointelegraph, cointelegraph
