Bitcoin Hits Record High Above $93,000; How to Capitalize on Bitcoin's Surge with ETFs

Bitcoin breached the $90,000 threshold on Wednesday, reaching a record high above $93,000. It now stands as the world's seventh-largest asset, with a market capitalization of $1.7 trillion, surpassing Meta Platforms Inc. and silver.

The cryptocurrency's recent ascent is attributed to a spike in derivative purchases, significant inflows into Bitcoin spot funds, and the Federal Reserve's recent rate cuts, which have propelled risk asset prices.

In the short term, Bitcoin's outlook remains optimistic. Jake Ostrovskis, an over-the-counter trader at crypto market maker Wintermute, observed that traders are speculating Bitcoin will reach $100,000 by year-end, with $850 million in options contracts betting on this milestone by December 27.

Several countries are considering adding Bitcoin to their national reserves. With Donald Trump back in office, there is potential for the U.S. to revisit previous commitments to adopt Bitcoin as a strategic reserve. In October, Bitcoin proponent Samson Mow addressed Germany's Bundestag, advocating for Bitcoin's inclusion in strategic reserves.

Crypto analyst PlanB forecasts that starting March 2025, nations like Bhutan, Argentina, and Dubai may begin to adopt Bitcoin as legal tender.

However, Michael Novogratz, founder of Galaxy Digital LP, a crypto-focused firm, voiced skepticism about the U.S. creating a Bitcoin strategic reserve. He added that if such a move occurs, Bitcoin's price could skyrocket to $500,000.

In early 2024, the SEC approved 11 Bitcoin spot ETFs for the first time. On November 11, U.S. Bitcoin spot ETFs recorded their highest total trading volume in over seven months.

Notably, uncertainty remains over whether Donald Trump will fulfill his previous commitments to support cryptocurrencies after he takes office. Bitcoin's volatility underscores the need for investors to stay vigilant, closely tracking market sentiment and news developments to manage risk effectively.