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Bitcoin surges over 120% and hits $100,000 milestone in

2024

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Sector market value reaches $3.5 trillion

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Institutional adoption grows

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Trump's re-election boosts industry confidence

By Manya Saini

Dec 31 (Reuters) - Bitcoin more than doubled in

2024 driven by the U.S. markets regulator's approval for

exchange-traded funds tied to its spot price, and optimism over

easing regulatory hurdles with Donald Trump set to return to the

White House.

The world's largest and most well-known cryptocurrency hit

$100,000 earlier this month, a milestone that has ignited

'animal spirits' among supporters of the once-nascent asset

class.

A more than 120% surge in bitcoin this year and a nearly 50%

jump in ether, the second-largest cryptocurrency, have

propelled the sector's market value to roughly $3.5 trillion,

according to CoinGecko data.

More gains are in store for 2025, according to analysts.

"We remain convinced $100,000 is not the final milestone. We

expect Bitcoin to hit a cycle-high of $200,000 in late 2025,"

analysts at brokerage Bernstein wrote in a client note earlier

this month.

MicroStrategy ( MSTR ), a software firm that has become the

world's largest corporate holder of bitcoin, has seen its shares

surge nearly five-fold in 2024.

The stock, which joined the benchmark Nasdaq-100 index

recently, is now seen as a proxy for bitcoin, with its movement

closely tied to sentiment towards the digital asset. Several

smaller companies are following its playbook and allocating

portions of their cash to bitcoin.

"We expect bitcoin to emerge as the new-age premier 'store

of value' asset eventually replacing gold over the next decade

and becoming a permanent part of institutional multi-asset

allocation and a standard for corporate treasury management,"

the Bernstein note said.

Much of the optimism began in January when the U.S.

Securities and Exchange Commission approved the first ETFs to

track the spot price of bitcoin, marking a watershed moment for

the broader crypto industry.

The move gave the sector institutional legitimacy and

improved its mainstream appeal as traditional finance

heavyweights including BlackRock ( BLK ) and Fidelity launched

the products.

The victory of Trump, who has promised to make the United

States the "crypto capital of the planet," further bolstered the

industry's position later this year. Crypto advocates donated

millions during the election, hoping to elect candidates that

favor the sector.

Most crypto stocks have also benefited from the

industry-wide rally. The big winners of 2024 are MicroStrategy ( MSTR ),

crypto exchange Coinbase and bitcoin miner Hut 8 ( HUT )

On the other hand, several other crypto miners have reeled

under shrinking margins due to higher energy and hardware costs,

missing the year's rally.

Shares of Riot Platforms ( RIOT ), Marathon Digital

and Bit Digital ( BTBT ) lost between 26% and 32% this year.