Bitcoin soared by more than double in 2024, driven by the U.S. market regulator’s approval of exchange-traded funds tied to its spot price and growing optimism surrounding the potential easing of regulatory challenges with Donald Trump eyeing a return to the White House.
The world’s leading cryptocurrency reached a milestone of $100,000 last month, igniting a surge of excitement among its supporters and further solidifying its place in the financial landscape.
Bitcoin’s remarkable 120% surge in 2024, along with nearly a 50% rise in ether, the second-largest cryptocurrency, has propelled the total market value of the sector to around $3.5 trillion, according to CoinGecko data.
Analysts predict further growth in 2025. “We believe $100,000 is just the beginning. We expect Bitcoin to hit a cycle-high of $200,000 by late 2025,” stated analysts from brokerage firm Bernstein in a recent client note.
MicroStrategy, the world’s largest corporate holder of Bitcoin, saw its shares surge nearly five-fold in 2024. The software company’s stock, which recently joined the Nasdaq-100 index, is now considered a proxy for Bitcoin, with its value closely linked to market sentiment surrounding the digital asset. Other companies are also following suit, directing parts of their cash reserves into Bitcoin.
“We believe Bitcoin will eventually replace gold as the premier ‘store of value’ asset over the next decade, becoming a permanent fixture in institutional portfolios and corporate treasury management,” the Bernstein note continued.
Much of the positive momentum began in January when the U.S. Securities and Exchange Commission approved the first ETFs tracking Bitcoin’s spot price, a game-changing move for the broader crypto industry. This decision granted institutional legitimacy to the sector, boosting its appeal as major financial institutions like BlackRock and Fidelity launched these products.
The rise of Trump, who has promised to transform the U.S. into the “crypto capital of the planet,” further supported the industry’s growth later in the year. Crypto advocates contributed millions to his campaign, hoping to elect candidates who would champion the sector.
The industry-wide rally has benefitted many crypto stocks, including MicroStrategy, crypto exchange Coinbase, and Bitcoin miner Hut 8, which all experienced significant gains in 2024.
However, some crypto miners struggled to capitalize on the rally, with rising energy and hardware costs eating into their profits. Shares of companies such as Riot Platform, Marathon Digital, and Bit Digital saw losses ranging between 26% and 32% last year.