Bitcoin’s Trump-fueled rally is losing steam as the year comes to a close

(Bloomberg) — Bitcoin’s rally, sparked by US President-elect Donald Trump’s election victory in early November, has stalled as 2024 draws to a close.

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The digital asset hovered at US$93,678 as of 7:53am on Monday in Singapore, about US$15,000 below the record high set in mid-December. Smaller tokens such as Ether and meme-favorite Dogecoin have also struggled to gain traction.

Trump’s preference for cryptocurrency-friendly regulations and support for the idea of ​​a national bitcoin reserve has lifted the digital asset. But the Fed’s reduced interest rate cut expectations have cooled the speculative frenzy.

More clarity on the US cryptocurrency regime is likely to emerge after Trump takes office on January 20. The Republican’s position contrasts with President Joe Biden’s administration, which has taken strict measures against the scandal-prone sector.

“The momentum came from the post-election movement” in Bitcoin, partly due to outflows from exchange-traded funds for the token, said Chris Weston, head of research at Pepperstone Group.

Meanwhile, MicroStrategy Inc., a Bitcoin software maker-turned-software maker, has been on a buying spree in the past few weeks. Traders are waiting to see if the company – which owns more than $40 billion in digital assets – will continue the pattern of announcing Bitcoin purchases on Monday.

The native cryptocurrency has risen nearly 120% this year, outpacing traditional investments such as global stocks and gold. Bitcoin also doubled in 2023 in a comeback from a deep bear market.

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