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Bitcoin has doubled this year

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Trump, pro-crypto Congress seen clearing regulatory clouds

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Elon Musk, a major Trump ally, supports cryptocurrencies

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Crypto-related stocks have surged

Dec 5 (Reuters) - Bitcoin rose above $100,000 for the

first time on Thursday as the election of Republican Donald

Trump as president of the United States spurred expectations

that his administration will create a friendly regulatory

environment for cryptocurrencies.

Bitcoin has more than doubled in value this year and is up

about 45% in the four weeks since Trump's sweeping election

victory, which also saw a slew of pro-crypto lawmakers being

elected to Congress.

"We're witnessing a paradigm shift. After four years of

political purgatory, bitcoin and the entire digital asset

ecosystem are on the brink of entering the financial

mainstream," said Mike Novogratz, founder and CEO of U.S. crypto

firm Galaxy Digital.

"This momentum is fueled by institutional adoption,

advancements in tokenization and payments, and a clearer

regulatory path."

More than 16 years after its creation, bitcoin appears on

the cusp of mainstream acceptance, despite naysayers and a

history of controversies.

"Bitcoin crossing $100,000 is more than just a milestone;

it's a testament to shifting tides in finance, technology, and

geopolitics," said Justin D'Anethan, a Hong Kong-based

independent crypto analyst.

"The figure not that long ago dismissed as fantasy, stands

as a reality."

Trump embraced digital assets during his campaign, promising

to make the United States the "crypto capital of the planet" and

to accumulate a national stockpile of bitcoin.

Crypto investors see an end to increased scrutiny under U.S.

Securities and Exchange Commission Chair Gary Gensler, who said

last week he would step down in January when Trump takes office.

On Wednesday, Trump said he would nominate Paul Atkins to

run the Securities and Exchange Commission. Atkins, a former SEC

commissioner, has been involved in crypto policy as co-chair of

the Token Alliance, which works to "develop best practices for

digital asset issuances and trading platforms," and the Chamber

of Digital Commerce.

A slew of crypto companies including Ripple, Kraken and

Circle are jostling for a seat on Trump's promised crypto

advisory council, seeking a say in his planned overhaul of U.S.

policy, according to several digital asset industry executives.

Trump's businesses may also have a stake in the sector. He

unveiled a new crypto business, World Liberty Financial, in

September. Although details about the business have been scarce,

investors have taken his personal interest in the sector as a

bullish signal.

Trump's social media company is in advanced talks to buy

crypto trading firm Bakkt ( BKKT/WS ), the Financial Times reported

last week, citing two people with knowledge of the talks.

Trump Media and Technology Group ( DJT ), which operates

Truth Social, is close to an all-stock acquisition of Bakkt ( BKKT/WS ),

according to the FT report.

Billionaire Elon Musk, a major Trump ally, is also a

proponent of cryptocurrencies.

Bitcoin's rebound from a slide below $16,000 in late 2022

has been rapid, boosted by the approval of U.S.-listed bitcoin

exchange-traded funds in January this year.

The Securities and Exchange Commission had long attempted to

block ETFs from investing in bitcoin, citing investor protection

concerns, but the products have allowed more investors,

including institutional investors, to gain exposure to bitcoin.

More than $4 billion has streamed into U.S.-listed bitcoin

exchange-traded funds since the election.

"We were trading basically sideways for about seven months,

then immediately after November 5, U.S. investors resumed buying

hand-over-fist," said Joe McCann, CEO and founder of Asymmetric,

a Miami digital assets hedge fund.

There was a strong debut for options on BlackRock's ETF

in November with call options - bets on the price going

up - substantially more popular than puts. McCann calculated the

put to call ratio at about 22 to one.

Crypto-related stocks have soared along with the bitcoin

price, with shares in bitcoin miner MARA Holdings ( MARA ) up

around 65% in November.

Yet the rise is not without critics.

Two years ago, the industry was wracked by scandal with the

collapse of the FTX crypto exchange and the jailing of its

founder Sam Bankman-Fried.

The cryptocurrency industry also has been criticized for its

massive energy usage, while crypto crime remains a concern, too.

Market participants are keeping a close eye on what happens

now that bitcoin has broken above $100,000, with investors and

speculators possibly looking to pocket some of their recent

gains.

"But once we flush out those sell orders, this could go

higher still, and very rapidly," said Steven McClurg, founder of

Canary Capital, a digital assets investment firm. He said he

expects bitcoin's price to hit $120,000 by Christmas.

(Compiled by Reuters staff; Editing by Alden Bentley, Lisa

Shumaker, Shri Navaratnam and Chizu Nomiyama)