The Bitcoin price has surpassed US$100,000; and its all because of Donald Trump’s hire for the SEC

It finally happened – the bitcoin price exceeded US$100,000. It has been a spectacular run in 2024 with the digital currency more than doubling this year, putting it well ahead of most stock market indices and most other investable assets generally. Its total market capitalisation, at US$3.8tn, exceeds even Nvidia (NDQ:NVDA) and Apple (NDQ:AAPL), the world’s most valuable stocks.

Wherever it goes to from here, there is no doubt that this is a major milestone that deserves cause for reflection.

There are plenty of reasons why bitcoin keeps rising, but it appears there is one specific reason why it has crossed this threshold.

The Bitcoin price has surpassed US$100,000 and here’s why

President-elect Donald Trump named someone to lead the Securities and Exchange Commission who crypto advocates are a fan of – Paul Atkins, the CEO of Patomak Partners. And investors believe he’ll be good for crypto because Atkins has been an advocate of looser regulations of digital assets. He has been involved in crypto policy as co-chair of crypto lobby groups Token Alliance and the Chamber of Digital Commerce.

Curiously, Atkins has served on the SEC before, as a regular commissioner under the second President Bush.

Under previous administrations, including the first Trump administration, the SEC has been perceived to be too conservative in bitcoin. One piece of evidence was how it took so long to approve a bitcoin ETF, and when it finally did, went out of its way to stress that it did not endorse bitcoin as an asset class.

A solid future for bitcoin?

But with Atkins at the helm, things may be different. ‘He believes in the promise of robust, innovative capital markets that are responsive to the needs of investors, and that provide capital to make our economy the best in the world,’ the former President said on Truth Social.

‘He also recognises that digital assets and other innovations are crucial to making America greater than ever before’.

Is this just a coincidence? Well, the morning of Atkins’ appointment was the day when bitcoin crossed the $100,000 mark. Since Atkins’ appointment, another step he has taken is to appoint David Sacks as White House AI and Crypto Czar. Trump promised to create such a position dedicated to crypto, and he is delivering.

It is easy to forget that Trump once called bitcoin a ‘scam’ – how times change. He has promised to make the US ‘the crypto capital of the planet’ and to found a ‘strategic national bitcoin stockpile’. A couple of months ago, he launched his own crypto business, World Liberty Financial.

So does this mean I should buy crypto?

Well, we think no. But then again, you might be reading this some months from when we published this article and seeing bitcoin at $200,000 or $300,000. Bitcoin could rise further from here, but past precedent has shown it is extremely volatile.

It is easy to forget that after it peaked at US$19,500 in late 2017, it crashed and only reached those levels again in late 2020, around the time PayPal allowed customers to hold it. It reached over US$60,000 in mid-2022, only to crash below US$20,000 around the time FTX collapsed. The third bubble evolved across the 2nd half of 2023 as bitcoin ETFs were launched and approved. Prices were flatlining for most of the US election campaign but have taken off ever since. So it could take the collapse of one particular cryptocurrency, or perhaps the firing of Atkins (or even his failure to be nominated by the Senate) that could cause a crash which could be up to 70%. Don’t take our word for it – take past precedent.

Moreover, even if you buy bitcoin, it is no easy feat because buying actual bitcoin and storing it is not as simple as buying any other stock.

If you want exposure to bitcoin, you’d be best off buying a dedicated ETF. And  you’ll do better buying an established cryptocurrency rather than some unstable memecoin.

What are the Best ASX Stocks to invest in right now?

Check our buy/sell tips