The re-election of Donald Trump as U.S. President led to a significant surge in the cryptocurrency market. Bitcoin soared to new highs, pushing other cryptocurrencies upward.
Increased Buying Activity
Following the launch of spot Bitcoin ETFs in the U.S., investor interest in cryptocurrencies surged. Popular ETFs like BlackRock's showed substantial inflows, indicating growing market optimism.
Psychological Factors
A widespread feeling of FOMO (Fear of Missing Out) has encouraged both short and long-term investments in cryptocurrencies. Despite record highs, research shows current profit-taking activity is lower than in past peaks.
Acceptance of Bitcoin as a Reserve Asset
Bitcoin is increasingly recognized as a safe haven. Economist Matthew Ferranti argues it's an 'effective portfolio diversifier' due to weak correlations with other financial assets.
While repeating Bitcoin's 1900% jump from Trump's first term is unlikely, market optimism remains. Both crypto and traditional markets are bracing for volatility amid new attitudes to cryptocurrencies in Trump's era.
