Bitcoin extends its rise, approaching the $100,000 threshold

Bitcoin’s rally shows no signs of stopping as the cryptocurrency surpassed the $98,000 mark on November 21. This is the result of a continuous growth streak since the US presidential election, with an increase of more than 40% in just two weeks.

Illustration of Bitcoin cryptocurrency. Photo: REUTERS/TTXVN

According to CoinDesk, as of 8:30 a.m. ET, Bitcoin was trading at $97,466 after rising to a high of $98,349.

The reason for the sudden growth of the world's most valuable cryptocurrency comes from the upcoming change in US politics, with President-elect Donald Trump showing strong support for cryptocurrencies, creating a new wave of optimism in the market. He pledged to turn the US into the world's cryptocurrency center and create a "strategic reserve" in Bitcoin. Along with that, the emergence of spot Bitcoin ETFs has opened up an attractive new investment channel for traditional investors, pushing up demand for Bitcoin. In the context of rising inflation, many investors look to Bitcoin as an inflation-hedging asset.

While the current outlook is bright, investors should be aware that the cryptocurrency market remains highly volatile. Bitcoin prices can fall sharply in the short term, especially when there are unexpected market movements.

Bitcoin was just above $5,000 at the start of the COVID-19 pandemic. Its price rose to nearly $69,000 in November 2021, a time of high demand for tech assets. Bitcoin then crashed amid a series of aggressive interest rate hikes by the Federal Reserve (Fed - Central Bank) to curb inflation. The collapse of the FTX cryptocurrency exchange in late 2022 significantly weakened confidence in cryptocurrencies in general, and Bitcoin fell below $17,000.

Investors began to return in large numbers as inflation began to cool and prices spiked due to anticipation and then the initial success of spot ETFs. Experts still warn investors to be cautious, especially those with small capital. Additionally, Bitcoin mining consumes a lot of energy and has a negative impact on the environment. This is an issue that the community is concerned about and developers are looking to solve.

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