Bitcoin Nears $106,000 with Market Betting on Trump’s Crypto Policies

Bitcoin has surged to its highest weekly gain since the U.S. election week in November, as speculation grows about the return of Donald Trump, a pro-crypto advocate, for a second presidential term.

The cryptocurrency has climbed nearly 11% since Sunday, reaching $105,570 – a 5% increase on the day. This rebound follows a turbulent period where Bitcoin declined during three of the past four weeks, with its record high of $108,315 still standing from December.

Market sentiment appears to be aligning with expectations of Trump’s favorable stance on cryptocurrencies. Zaheer Ebtikar, founder of Split Capital, noted that “investors are factoring in Trump’s potential presidency and his crypto-positive outlook.” Reports from Bloomberg suggest that Trump is planning an executive order to elevate Bitcoin within his administration’s priorities, aiming to foster collaboration with industry leaders—a notable departure from his earlier skepticism toward digital assets.

Bitcoin’s rally also mirrors a broader upswing in riskier investments, driven by easing inflation concerns in the U.S. Recent data showing weaker-than-expected figures for the Producer Price Index ( PPI ) and Consumer Price Index ( CPI ) has renewed hopes for further interest rate cuts by the Federal Reserve.

This has created a more favorable environment for crypto investors, according to Jake Ostrovskis, a trader at Wintermute, a crypto market-making firm. “With macroeconomic fears subsiding, the focus has shifted back to crypto-specific drivers,” Ostrovskis explained.

However, the market may face turbulence as Trump’s inauguration date nears. Ostrovskis highlighted that the options market is signaling increased volatility in late January, suggesting the possibility of heightened price swings as investors brace for upcoming political developments.