Bitcoin surpasses $101,000: Is this start of a new rally?
Bitcoin, the world's largest cryptocurrency by market capitalization, has crossed the $100,000 mark once again. On December 12, it hit a value of $101,373. The surge comes after US inflation data was released in line with forecasts, increasing the chances of a Federal Reserve interest rate cut. The cryptocurrency rose nearly 5% in the US on December 11, its biggest gain in two weeks. However, at the time of writing, Bitcoin was trading at $100,770.39.
Market optimism fuels Bitcoin's surge
Bitcoin had previously reached an all-time high of $103,800 on December 5 but failed to stay above $100,000 as traders took profits. The current market optimism is driven by expectations of a Fed rate cut and President-elect Donald Trump's plans to reverse the Biden administration's crypto regulations. Since Trump's election victory in November 2024, Bitcoin has surged by some 50%.
Bitcoin ETFs and Ether attract significant investments
Amid Bitcoin's rally, US spot Bitcoin exchange-traded funds have recorded inflows of $11 billion during this time. The second-largest cryptocurrency, Ether, has also drawn investments of $2.4 billion. Henry Elder of UTXO Management said, "the market likes seeing inflation come in within expectations," adding that traders are determining whether "$100,000 is a ceiling or a floor."
Cryptocurrency market capitalization on the rise
The global cryptocurrency market capitalization rose by 5.53% to $3.64 trillion on December 12. Bitcoin's market cap increased by 4.30% to $2.01 trillion, holding a dominant market share of 55.09%. Other cryptocurrencies such as Ethereum and Dogecoin are also witnessing upward trends amid renewed market optimism.
