The number of cryptocurrency startups is currently increasing in the United States. (AI image for representation only) Bitcoin, the world's most recognized cryptocurrency, has breached the $100,000 mark for the first time, riding a wave of optimism following the election of Donald Trump as US president. With President Trump's pledge to make the United States the “crypto capital of the planet” and the nomination of Paul Atkins, an avid cryptocurrency supporter, to head the Securities and Exchange Commission (SEC), cryptocurrencies have become 12 It reached a high of $103,800 on May 5th. The announcement shocked the cryptocurrency community and signaled a possible review of the regulatory approach.
why is it important
This unprecedented milestone reflects not only Bitcoin's volatile nature, but also broader geopolitical and economic changes. The United States has emerged as the dominant force in cryptocurrencies previously held by China. Trump's victory breathed new life into the sector, increasing investor confidence and setting the stage for a transformative era in digital finance. Bitcoin's rise highlights the growing mainstream acceptance of digital currencies as a legitimate asset class and the pivotal role of U.S. policy in shaping global financial trends. If the United States takes the lead, the landscape surrounding digital assets will change dramatically. The big picture: How China lost to the US machinations
China was once a center for Bitcoin mining and trading, but has ceded that dominance due to a series of aggressive regulatory crackdowns.
China initially dominated the Bitcoin world, particularly in the area of mining, leveraging its abundant, low-cost electricity and manufacturing capabilities. By 2017, more than 70% of Bitcoin mining capacity was concentrated in China, and Bitcoin played a pivotal role in the governance of the network. However, this advantage was short-lived due to regulatory crackdowns. In 2017, China banned initial coin offerings (ICOs) and shut down domestic cryptocurrency exchanges.
In 2021, the Chinese government banned Bitcoin mining and declared crypto trading illegal, citing concerns about financial stability, fraud, and energy consumption. These measures forced miners and crypto businesses out of the country, with many relocating to other crypto-friendly countries and regions.
Main factors of China's decline
Regulatory crackdown: China's 2021 crypto mining and trading ban forced companies to flee, with many miners moving to the United States, where states like Texas offer cheap energy and favorable policies. Capital controls: The Chinese government's strict limits on capital outflows conflict with cross-border policies Energy concerns: Bitcoin mining's huge energy consumption brings China's climate goals to a crackdown on operations using non-renewable energy sources A missed opportunity for governments: While China is focused on its central bank digital currency (CBDC), the digital yuan, regulations on private cryptocurrencies are stifling widespread innovation. US advantages
The US is capitalizing on China's withdrawal, leveraging its decentralized regulatory environment, robust financial markets, and culture of innovation to attract crypto talent and investment. The Spot Bitcoin ETF, launched in January, is a game-changer, attracting more than $4 billion in institutional investors this year alone. These ETFs have provided an entry point for traditional investors to gain exposure to Bitcoin, increasing its value.
America's entrepreneurial spirit has also fueled the development of blockchain technology, decentralized finance (DeFi) platforms, and non-fungible tokens (NFTs), cementing our position as a global leader in digital innovation.
How Trump Changed the Game
Trump's campaign promise resonates with the cryptocurrency industry. His pro-crypto stance included plans to create a strategic Bitcoin reserve using government-seized assets and establish a national advisory board on cryptocurrencies. These proposals, coupled with the appointment of Paul Atkins as SEC Chairman, signal a shift toward a more supportive regulatory framework. Atkins, a former SEC commissioner and vocal critic of overregulation, is expected to dismantle his predecessor's enforcement-focused approach. Gary Gensler. Gensler's tenure has been marked by lawsuits against crypto companies and allegations that he is stifling innovation. Under Mr. Atkins, the SEC is likely to prioritize fostering innovation while maintaining investor protection, in line with Mr. Trump's vision of making the United States a global leader in digital assets. Trump's influence extends beyond policy. His involvement with the cryptocurrency community, including speaking at Bitcoin conferences and launching World Liberty Financial with his family, has given the industry confidence. This led to a significant price increase for Bitcoin. Since Trump's election victory on November 5, the price of Bitcoin has increased by about 45%, fueled by a wave of buying that poured money into US Bitcoin-backed exchange traded funds (ETFs). Since then, the value of the entire cryptocurrency market has increased by about $1.3 trillion. Trump’s victory reflects the alignment of his platform with the crypto sector. U.S. Bitcoin ETFs have seen about $32 billion in net inflows this year, and more than $8 billion since Trump became president-elect, according to Bloomberg data. Meanwhile, the total trading volume of digital assets and related derivatives on centralized exchanges reached a record $10 trillion last month, according to a report by CCData. Bitcoin's journey from the libertarian fringes to Wall Street has created billionaires, established a new asset class, and popularized “decentralized finance.” It has been a turbulent 16 years since its founding.
what they are saying
Bitcoin’s milestone of surpassing $100,000 provoked a wide range of reactions from industry leaders, financial experts, and crypto analysts, reflecting both the excitement and caution that characterize the volatile world of cryptocurrencies. Ta. As reported by Reuters, here's what experts say:
Shoki Omori, Mizuho Securities, Chief Japan Desk Strategist, Tokyo
“Retail investors should be excited to see BTC price rise above $100,000 following the news that Paul Atkins has been named SEC Chairman…Of course, this means that BTC will not be permanently traded. This does not mean that prices will rise, but there will be some profit-taking.”
Jeff Mei, Chief Operating Officer (COO), Hong Kong BTSE
“Bitcoin’s soaring above $100,000 is not just a milestone, but represents a pivotal moment for the crypto industry, whose confidence is fueled by an increasingly favorable regulatory environment in the US. “I'm hanging on.”
Geoff Kendrick, Global Head of Digital Asset Research, Standard Chartered, London
“At the end of the day, this is just a number…but the reality is that we were able to reach this level, especially this year as the industry institutionalized. And that's largely due to the influx of ETFs. .”
Kyle Rodda, Senior Financial Markets Analyst, Capital.com, Melbourne
“This is a major milestone for true believers and could serve as a vindication of the asset… given lower regulatory risk and increased geopolitical risk, could support price appreciation A certain tailwind continues.”
Justin D'Anethan, Independent Crypto Analyst, Hong Kong
“Bitcoin’s passing of $100,000 is not just a milestone, but a testament to changing trends in finance, technology, and geopolitics, as evidenced by increased volume in the CME, ETF, and derivatives markets during U.S. time. As such, institutional adoption is clear.
Ray Attrill, Head of Sydney FX Research, NAB
“This is the ultimate speculative asset, right? The test will be whether risk sentiment deteriorates significantly at some point and we see a significant stock market correction.”
Richard Teng, CEO, Binance, Dubai
“Bitcoin has reached the milestone of $100,000 per coin and the asset market cap has reached $2.1 trillion. We are on the brink of true mainstream global adoption. It’s standing.”
A little bit about the Bitcoin cycle and halving
Bitcoin operates on a cyclical model that is heavily influenced by halving events that occur approximately every four years. Bitcoin’s most recent halving event occurred on April 19, 2024, marking the fourth halving. Historically, such halvings have been pivotal moments in Bitcoin's lifecycle, often resulting in significant changes in market dynamics and price movements. In fact, each cycle can be broken down into four main stages. Halvings, bull periods, market crashes, and plateaus. The halving event reduces miners' block rewards by 50%, effectively slowing down the rate at which new Bitcoins come into circulation. This decrease in supply typically leads to an increase in demand and subsequent price increases, initiating a bullish phase characterized by increased speculation and buying activity. Historically, this phase saw Bitcoin prices reach all-time highs as investors reacted to the perceived scarcity of the asset. Bitcoin often experiences significant market declines, commonly referred to as crashes, following the peaks of bullish periods. This crash could be caused by investor profit-taking, panic selling, or a broader market correction. After this downturn, Bitcoin enters a period of long-term stability, also known as “crypto winter,” where the price remains low and stable for a long period of time (usually around two years). At this stage, market sentiment tends to be bearish, but it also provides an opportunity for accumulation as prices are relatively low compared to previous highs. This cycle continues as expectations for the next halving event increase, reigniting interest and investment in Bitcoin.
President Trump's crypto-promoting policies have not only strengthened the US market, but also highlighted the limitations of China's approach. China's digital yuan is intended to challenge the economic dominance of the United States, but China's hostility toward private cryptocurrencies has created a vacuum that the United States has quickly filled.
Geopolitically, this shift highlights a broader narrative. This means countries that embrace innovation and regulatory flexibility are positioned to take the lead in emerging areas such as blockchain and cryptocurrencies. As the United States strengthens its foothold, the question remains whether China will pivot to a more crypto-friendly stance or further tighten its restrictive policies.
Environmental and social concerns
Bitcoin's rise has reignited debate over its environmental impact. The energy-intensive Bitcoin mining process has drawn criticism, especially in countries that rely on fossil fuels. A recent study revealed that Bitcoin's carbon footprint in 2021 was equivalent to burning 84 billion pounds of coal. But industry leaders say the increased use of renewable energy in mining operations is alleviating these concerns.
Critics also point to Bitcoin's association with illegal activities such as money laundering and ransomware attacks as challenges that must be addressed for wider adoption.
what's next
Strategic Bitcoin Reserve: President Trump's proposal to create a national Bitcoin reserve using seized assets could further legitimize the cryptocurrency and encourage other countries to follow suit There is a possibility. China's response: Experts doubt whether the Chinese government will lift its ban on private cryptocurrencies, but Hong Kong could serve as a sandbox for crypto activities for China to re-enter the market. Provides limited routes. Market trajectory: Analysts say: There is also optimism about Bitcoin's future, with some predicting it will rise to $120,000 by 2025, as reduced regulatory risk and geopolitical instability make it more attractive as a hedge against traditional currencies. There are some too. Conclusion: Bitcoin's historic rise to $100,000 marks a turning point in the global cryptocurrency landscape. Under President Trump's leadership, the United States has seized the opportunity to become the center of digital asset innovation, leaving China behind. “Investors need to remember that assets are not going to rise linearly forever,” Josh Gilbert, a market analyst at eToro, told Bloomberg. “Bitcoin drawdowns are to be expected, but it feels like something big will have to happen to slow Bitcoin down at this point.” (Includes information from the agency)
