The Bitcoin rally that gained momentum following U.S. President-elect Donald Trump’s victory in early November appears to be losing steam as 2024 comes to a close.
As of 5:25 a.m. in London on Monday, Bitcoin traded at $93,085, approximately $15,000 below its all-time high reached in mid-December. Other digital assets, including Ether and Dogecoin, have also struggled to maintain their upward momentum.
Trump’s crypto-friendly regulatory stance, combined with his backing for a national Bitcoin reserve, initially fueled the surge in digital asset prices. However, waning expectations of aggressive interest rate cuts by the Federal Reserve have tempered the speculative fervor that characterized the post-election rally.
Traders are now looking to January 20, when Trump assumes office, for further clarity on the U.S. government’s approach to cryptocurrencies. His policies, which contrast sharply with the Biden administration’s crackdown on the industry, have created a sense of uncertainty in the market.
Chris Weston, head of research at Pepperstone Group, noted that “the momentum has come out of the post-election move” for Bitcoin, attributing part of the slowdown to outflows from exchange-traded funds tied to the cryptocurrency.
Despite this, MicroStrategy Inc., the software company that has morphed into a major Bitcoin holder, has continued its aggressive buying strategy. With over $40 billion invested in Bitcoin, the company has become a key player in the market, with traders watching closely for updates on its Bitcoin purchases, particularly on Mondays.
Bitcoin has surged approximately 120% this year, outpacing traditional investments such as global stocks and gold. The cryptocurrency’s 2023 recovery from a prolonged bear market also contributed to the rally’s momentum.
As the year ends, the future direction of Bitcoin and other digital assets remains closely linked to broader macroeconomic trends, including potential changes to U.S. monetary policy and the evolving regulatory landscape under the incoming administration.
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