When Will This Round of Cryptocurrency Rally Peak?

KEYTAKEAWAYS

TABLE OF CONTENTS

• KEY TAKEAWAYS
• THE IMPACT OF TRUMP’S VICTORY ON THE CRYPTO MARKET
• FOUR MAJOR CRYPTO POLICIES TRUMP MAY IMPLEMENT
• DISCLAIMER
• WRITER’S INTRO

CONTENT

Trump’s victory sparks crypto market surge with Bitcoin hitting $82,000. Analysis of potential crypto policies, market predictions, and the upcoming Bitcoin halving suggests continued growth through 2024.

Since Trump’s victory, the crypto market has seen a surge in enthusiasm, with Bitcoin prices repeatedly reaching new highs. On November 11, Bitcoin broke the $82,000 mark, and Ethereum’s market cap surpassed that of Bank of America. We believe this upward trend may be just beginning and could continue until Trump’s official inauguration.

So far this year, Bitcoin’s cumulative gain has exceeded 90%, driven by strong demand for spot ETFs and expectations of Federal Reserve rate cuts, significantly outperforming returns from the U.S. stock market and gold over the same period.

Bitcoin’s cumulative gain has exceeded 90%, driven by strong demand for spot ETFs and expectations of Federal Reserve rate cuts

(Source: TradingView)

THE IMPACT OF TRUMP’S VICTORY ON THE CRYPTO MARKET

Trump has incorporated support for cryptocurrencies into his campaign platform, pledging to back and enhance the U.S. cryptocurrency industry and end SEC crackdowns on digital assets. His victory is viewed as the most favorable outcome for crypto assets. Following the election, Bitcoin ETFs saw a rapid influx of capital, with BlackRock’s iShares Bitcoin Trust ETF (IBIT) setting a record last Thursday with nearly $1.4 billion in single-day net inflows.

BlackRock’s iShares Bitcoin Trust ETF (IBIT) setting a record last Thursday with nearly $1.4 billion in single-day net inflows

(Source: SoSoValue)

Analysts predict that the Trump administration will follow through on its promises, enacting early-stage policy changes to leverage Republican control of Congress before the 2026 midterms. Bitcoin’s price is expected to continue its rise, with a potential year-end target of $100,000. The total crypto market cap could also grow from its current $2.5 trillion to $10 trillion by the end of 2026.

FOUR MAJOR CRYPTO POLICIES TRUMP MAY IMPLEMENT

1. Repeal of SAB 121: SEC’s guidance under SAB 121 mandates that entities holding custody of digital assets list these assets on their balance sheets and create corresponding liabilities. Repealing SAB 121 could pave the way for greater institutional adoption of digital assets.

2. Advancing the Stablecoin Act: Stablecoins are gaining importance as real-world applications for digital assets. Over the past year, three key bills aimed at establishing a regulatory framework for bank-issued stablecoins have been introduced in the House. Under the Trump administration, these bills are expected to progress further, possibly as early as 2025.

3. Leadership Change at the SEC: Under current Chair Gary Gensler, the SEC has taken a firm stance against digital assets. During his campaign, Trump explicitly stated he would replace Gensler.

4. Possibility of a Bitcoin Reserve Fund: Although a low-probability event, Trump mentioned in July that he would retain government-held Bitcoin (approximately 210,000 BTC). This move could have a significant positive impact on the price of this asset class.

Given the current momentum following the election, we anticipate Bitcoin’s next target price to be $90,000, which could be reached by November 29, and potentially hitting $100,000 by December 27. If this target isn’t met by December 31, Bitcoin could still reach it by January 20, Trump’s inauguration date, as numerous “Trump trades” in 2016 peaked around his inaugural ceremony.

2024 is shaping up to be an extraordinary year for Bitcoin. One of the key events in the cryptocurrency world, the Bitcoin halving, takes place roughly every four years—or more precisely, after every 210,000 blocks are mined. But what exactly is this halving?

In simple terms, the halving reduces the reward for mining new Bitcoin blocks by half, thereby slowing down the rate at which new Bitcoin is created and circulated. This mechanism, embedded in Bitcoin’s code by its creator, Satoshi Nakamoto, controls inflation by mimicking the scarcity and difficulty of mining precious metals.

The supply and demand mechanism is central to Bitcoin’s design. As rewards decrease, the supply growth slows. If demand remains steady or rises, this reduction in new supply could lead to price increases. The halving creates a form of synthetic inflation that declines over time, ensuring that the total supply of Bitcoin will never exceed 21 million coins.

Following Bitcoin’s previous halvings in 2012, 2016, and 2020, fourth-quarter returns were impressive, with gains of 97.7%, 58.17%, and 168.02%, respectively. Given this history, we continue to hold high expectations for Bitcoin’s price in the current cycle.