Bitcoin hits $106,000 record and these three drivers will push the price into ‘unchartered waters’

Bitcoin rocketed to a caller highest terms of $106,000 connected Monday ― a 150% surge since the commencement of the year.

Monday’s terms rally followed a little terms consolidation for Bitcoin aft it crossed the $100,000 milestone earlier successful December.

Petr Kozyakov, CEO of crypto payments level Mercuryo, said Bitcoin is successful “uncharted waters.”

“Bitcoin’s ascent to $106,000 shows that carnal spirits are successful play arsenic we participate the last weeks of 2024,” Kozyakov told DL News.

The marketplace seems to person established a “psychological support” astatine $100,000, said Mena Theodoru, co-founder of crypto speech Coinstash.

With 2 weeks near successful the year, marketplace observers are betting that Bitcoin’s terms inactive has country to grow.

“Bitcoin’s terms is being driven up amid expectations of sustained precocious demand, and respective notable quality catalysts culminating successful a caller all-time high,” Shannon Kurtas, caput of trading and crypto speech Kraken, told DL News.

Here are 3 factors that could pump Bitcoin’s price.

Supply squeeze

Bitcoin is getting scarcer amid monolithic withdrawals from crypto exchanges.

“Cryptocurrency exchanges are experiencing monolithic outflows, importantly reducing the availability of Bitcoin connected trading platforms,” crypto probe level 10x Research stated successful a study connected Monday.

“Simultaneously, OTC desks are moving debased connected inventory,” the study said. “Together, these factors bespeak a imaginable compression successful Bitcoin prices.”

OTC, oregon over-the-counter, desks are match-makers of sorts betwixt crypto buyers and sellers.

Bitcoin equilibrium connected large crypto exchanges. Credit: Coinglass

Coinbase, Binance, Bitfinex, and Gemini person each experienced monolithic Bitcoin outflows successful the past week, data from crypto analytics level Coinglass shows.

Outflows from large centralised exchanges person topped 180,000 Bitcoin since Donald Trump’s predetermination triumph past month.

For comparison, lone 40,000 Bitcoin was withdrawn from exchanges betwixt precocious July and November 4, according to Coinglass data.

Trump euphoria

Trump’s predetermination triumph and the crypto industry’s prospects nether his presidency are inactive causing a buzz successful the market.

The president-elect has promised to make a strategical Bitcoin reserve, a determination immoderate marketplace observers accidental volition legitimise the asset.

“If America builds a Bitcoin reserve, this volition make a FOMO effect, truthful we’re apt to spot different countries pursuing suit and sovereign wealthiness funds introducing Bitcoin allocations to the portfolios,” Tim Kravchunovsky, laminitis and CEO of decentralised web Chirp, told DL News.

As Trump’s inauguration connected January 20 nears, determination is palpable excitement for Bitcoin and the crypto market.

10x Research predicts that Bitcoin could surge to $120,000 by Trump’s inauguration.

Macro tailwinds

The lawsuit for Bitcoin climbing higher mightiness besides beryllium boosted by large economies adopting dovish monetary policies.

Bitcoin and crypto person performed good during periods of escaped monetary policies successful the past.

There’s a 97% accidental that the Federal Reserve cutting involvement rates to betwixt $4.25 and $4.50 astatine its December 18 meeting, according to CME Group’s FedWatch tool.

Low involvement rates are usually bullish for crypto arsenic it incentivises investors to stake connected riskier assets.

The cardinal banks of some Canada and Switzerland precocious chopped involvement rates. The aforesaid goes for the European Central Bank.

China already announced a monolithic $284 cardinal economical stimulus package successful September to spur growth.

Osato Avan-Nomayo is our Nigeria-based DeFi correspondent. He covers DeFi and tech. Got a tip? Please interaction him at [email protected].