Ever since Donald Trump won the 2024 U.S. presidential elections, the price of Bitcoin has been steadily increasing. At the start of December, it surpassed the $100,000 milestone for the first time in history. As the token’s value continues to go up even further, let’s look at four ways this could benefit the finance sector.
Growing User Adoption
Bitcoin breaking the $100,000 barrier cemented its role as a legitimate asset class and confirmed its long-term viability. It’s safe to say that crypto enthusiasts will see this milestone as a vindication of their belief in the token’s potential. As confidence grows, more and more individuals will be entering the cryptocurrency space.
The token is already being used extensively for various purposes. From online entertainment to everyday transactions, it has proven to be a legitimate alternative to traditional currencies.
One of the industries where the token’s impact has been most notable is online gambling with crypto casinos emerging as a better alternative to traditional ones. Playing in the best offshore casinos means players get to enjoy fast payouts, low-cost transactions, and increased security. Now, with even more confidence surrounding Bitcoin’s value and stability, these platforms will start attracting even more players.
Additionally, more individuals may start to rely on BTC when making peer-to-peer payments. Whether they’re sending money to friends or making purchases, more users will ditch fiat currencies in favor of Bitcoin as well as other cryptocurrencies.
Increased Institutional Adoption
The stance of banks, hedge funds, and other institutional investors towards Bitcoin has been quite turbulent. While they focused on blockchain technology, big players like JPMorgan Chase and Morgan Stanley were constantly distancing themselves from the popular token.
Over time, they began to recognize its potential and currently hold significant amounts. If any doubts over their commitment still existed, Bitcoin’s surge past the $100,000 milestone has erased them.
Now, even more large financial players will enter the market, giving Bitcoin more legitimacy within traditional finance. This could also pave the way for further investment products like Bitcoin ETFs and futures, which will prompt more traditional investors to enter the world of crypto.
An increasingly favorable regulatory environment in the U.S., particularly the appointment of Paul Atkins to chair the SEC will also drive more institutional investment in the sector, giving Bitcoin even more credibility.
Analysts also expect institutions to rotate into Ethereum ETFs, although they haven’t been as popular as Bitcoin ones up to now.
More Cryptocurrencies Exploding
Trump’s victory in the U.S. presidential elections had a significant impact on the cryptocurrency market. In fact, it was one of the key drivers behind the Bticoin’s surge to $100,000. His friendly stance towards digital currencies also caused other tokens to go up in value, with DOGE being the best example. The cryptocurrency inspired by a meme went up 340% year to date after a dramatic post-election rally.
Although cryptocurrencies have already been climbing following Trump’s victory, the market may now be poised for even more explosive growth after Bitcoin hit the $100,000 milestone. Analysts suggest that this could trigger a new wave of investments, pushing some smaller tokens to unprecedented highs.
If the momentum continues, the broader cryptocurrency market may enter one of its biggest bull runs up to date. And this only means one thing – cryptocurrencies will become an even more important player in the global financial system.
Mizuho Securities strategist, Shoki Omori, said that if Bitcoin continues to rally, other major digital currencies like Ethereum and Ripple would catch up fast. However, he added that they would still look cheap against Bitcoin.
Bitcoin Acting as a Preferred Wealth Store
Ever since it first emerged, Bitcoin has been drawing comparisons to gold in terms of its role as a store of value. Now, the Bitcoin-to-gold ratio has also hit its historic peak at 37.3 ounces.
Gold has been one of the most trusted assets for preserving wealth for thousands of years, mostly due to its scarcity and global liquidity.
Bitcoin shares the same values but in a more modern and digital form. With a fixed supply of 21 million coins, it offers a level of scarcity that is even more predictable and transparent. The token can also be transferred instantly across the globe with minimal fees, giving individuals and institutions a more efficient way to store and transfer wealth.
BTC plummeting in December could further facilitate its position in this role even further. More investors may start to rely on it as a tool against inflation and fiat currency devolution, much like they’ve commonly relied on gold.
Conclusion
Bitcoin crossing the $100,000 threshold marked a significant turning point for cryptocurrencies and the entire financial sector. As the confidence in its value continues to grow, so will its role as a core financial asset.
