Bitcoin Tops US$100,000 ($NZ$169,945) for the First Time

Bitcoin topped US$100,000 ($NZ$169,945) for the first time this week as a massive rally in the world's most popular cryptocurrency

Bitcoin price soared past the coveted US$100,000 ($NZ$169,945) mark for the first time ever on Wednesday (local time), continuing a massive rally in the world's most popular cryptocurrency — largely accelerated by the election of Donald Trump.

The cryptocurrency officially rose six figures on Wednesday night, just hours after the president-elect announced his intention to nominate cryptocurrency advocate Paul Atkins to be the next chair of the Securities and Exchange Commission.

Bitcoin has soared since Trump won the US presidential election on November 5. The asset climbed from US$69,374 (NZ$117,897) on Election Day, hitting as high as US$103,713 (NZ$176,255) on Wednesday, according to CoinDesk. And the latest all-time high arrives just two years after bitcoin dropped below US$17,000 (NZ$28,890) following the collapse of crypto exchange FTX.

Bitcoin fell back below the US$100,000 ($NZ$169,945) by Thursday afternoon (local time), sitting above US$99,000 (NZ$168,245) by 4pm ET. Even amid a massive rally that has more than doubled the value of bitcoin this year, some experts continue to warn of investment risks around the asset, which has quite a volatile history.

Here’s what you need to know.

What is cryptocurrency again?

In basic terms, cryptocurrency is digital money. This kind of currency is designed to work through an online network without a central authority — meaning it’s typically not backed by any government or banking institution — and transactions get recorded with technology called a blockchain.

Bitcoin is the largest and oldest cryptocurrency, although other assets like ethereum, XRP, tether and dogecoin have also gained popularity over the years. Some investors see cryptocurrency as a "digital alternative" to traditional money, but most daily financial transactions are still conducted using fiat currencies such as the dollar. Also, bitcoin can be very volatile, with its price reliant on larger market conditions.

Why is bitcoin soaring?

A lot of the recent action has to do with the outcome of the US presidential election.

Trump, who was once a crypto sceptic, has pledged to make the US "the crypto capital of the planet" and create a "strategic reserve" of bitcoin. His campaign accepted donations in cryptocurrency and he courted fans at a bitcoin conference in July. He also launched World Liberty Financial, a new venture with family members to trade cryptocurrencies.

On Thursday morning, hours after bitcoin surpassed the US$100,000 ($NZ$169,945) mark, Trump congratulated "BITCOINERS" on his social media platform Truth Social. He also appeared to take credit for the recent rally, writing, "YOU'RE WELCOME!!!"

Republican presidential candidate former President Donald Trump speaks at the Bitcoin 2024 Conference in July 2024. (Source: Associated Press)

Top crypto players welcomed Trump's election victory last month, in hopes that he would be able to push through legislative and regulatory changes that they've long lobbied for — which, generally speaking, aim for an increased sense of legitimacy without too much red tape.

And the industry has made sizeable investments along the way. Back in August, Public Citizen, a left-leaning consumer rights advocacy nonprofit, reported finding that crypto-sector corporations spent more than US$119m (NZ$202m) in 2024 to back pro-crypto candidates across federal elections.

Trump made his latest pro-crypto move when he announced his plans on Wednesday (local time) to nominate Atkins to chair the SEC. Atkins was an SEC commissioner during the presidency of George W. Bush.

In the years since leaving the agency, Atkins has made the case against too much market regulation. He joined the Token Alliance, a cryptocurrency advocacy organisation, in 2017.

Under current chair Gary Gensler, who will step down when Trump takes office, the SEC has cracked down on the crypto industry — penalising a number of companies for violating securities laws. Gensler has also faced ample criticism from industry players in the process.

One crypto-friendly move the SEC did make under Gensler was the approval in January of spot bitcoin ETFs, or exchange trade funds, which allow investors to have a stake in bitcoin without directly buying it. The spot ETFs were the dominant driver of bitcoin's price before Trump's win — but, like much of the crypto's recent momentum, saw record inflows post election.

What does bitcoin hitting the $100k mark mean?

Bitcoin surpassing the coveted $100,000 mark has left much of the crypto world buzzing.

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