Bitcoin has surged nearly 12% to $104,668, driven by expectations of a pro-crypto Trump administration and easing inflation concerns. Analyst commentary highlights the potential for volatility ahead of the inauguration.

Bitcoin, the preeminent cryptocurrency, has exhibited renewed upward momentum as expectations rise regarding President Donald Trump’s potential second term in office. Currently, Bitcoin is positioned for its largest weekly gain since the elections in November, having increased nearly 12% since Sunday, reaching $104,668, with a daily gain of 4.96%. This follows a period of mixed performance, during which Bitcoin experienced declines in three of the previous four weeks, despite having previously attained an all-time high of $108,315 in December.

Zaheer Ebtikar, founder of Split Capital, remarked, “The market is now pricing in Trump taking office and Trump being bullish on crypto.” Reports indicate that Trump is planning to issue an executive order that would prioritize Bitcoin within his administration’s policy agenda, promoting a more inclusive dialogue with cryptocurrency industry leaders, thereby signaling a significant shift from his earlier skepticism.

This week’s Bitcoin surge aligns with a broader rise in risk assets, attributed to easing inflation concerns in the United States. Notably, lower-than-anticipated Producer Price Index (PPI) and Consumer Price Index (CPI) data have rekindled investor optimism regarding potential rate cuts from the Federal Reserve. Jake Ostrovskis, a trader at Wintermute, commented, “The lower PPI and CPI have removed macro concerns, allowing investors to focus on crypto-specific catalysts.”

Nonetheless, Ostrovskis cautioned against possible market volatility as Trump’s inauguration date approaches. He noted, “The options market is showing that traders are betting on higher volatility in late January, which means the market could be running ahead of Monday’s inauguration.”

*This is not investment advice.

In conclusion, Bitcoin’s resurgence is driven by a combination of factors, including anticipation of President Trump’s pro-crypto policies and improved inflation data. Analysts express optimism regarding these developments while also cautioning about potential market volatility surrounding the upcoming inauguration. Investors may find themselves at a crossroads as they weigh the implications of these political and economic changes.

Original Source: coinmarketcap.com

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