Bitcoin's Price Officially Breaks $100,000: 4 Key Drivers Behind the Milestone

 has officially crossed the $100,000 mark, setting new all-time highs. Once dismissed by many as a scam or speculative experiment, Bitcoin has grown to become one of the top 20 most valuable assets globally, with a total market cap nearing $2 trillion. Over the past decade, Bitcoin has undergone one of the most significant perception shifts in financial history, with mass media and institutions reversing their skepticism and embracing its potential. The $100K milestone represents more than just a price point—it’s the result of years of increasing mainstream acceptance. Institutional investors are integrating Bitcoin into their portfolios, Bitcoin ETFs are breaking records, favorable global economic trends are driving demand, and political shifts are creating a more supportive environment. Let’s take a closer look at the key factors behind Bitcoin’s rise to over $100,000.

US Bitcoin ETFs: Validation For Traditional Investors

On January 10th, the SEC granted regulatory approval for 11 U.S. Bitcoin exchange-traded funds (ETFs). While European-listed exchange-traded notes (ETNs) had been available for years, the approval and launch of U.S.-based Bitcoin ETFs marked a pivotal moment for Bitcoin. This milestone not only eliminated significant barriers to entry for traditional investors but also reshaped public perception of Bitcoin as a legitimate and regulated financial asset. Here are some highlights.

Macroeconomic Factors: Bitcoin as a Hedge

Global economic conditions have increasingly positioned Bitcoin as an alternative investment for investors looking to protect and grow their wealth. Traditional investment options like bonds and savings accounts have become less attractive due to a combination of low interest rates, rising inflation, and negative real yields in several major economies. These shifts have driven both retail and institutional investors to view Bitcoin as a hedge against economic instability and a store of value, often referred to as digital gold.

Political Support: A Crypto-Friendly Climate

The political and regulatory climate is increasingly tilting in favor of cryptocurrencies, providing strong momentum for Bitcoin's growth. Governments and policymakers worldwide are recognizing the potential of blockchain technology and digital assets, shifting from skepticism to proactive engagement. These political tailwinds, coupled with regulatory advancements, are fostering a more secure and predictable environment for Bitcoin, boosting investor confidence.

Continued Institutional Adoption: Bitcoin Goes Mainstream

Institutional investors and corporations are driving Bitcoin’s transformation from a niche digital asset to a widely accepted investment and financial tool. Seen as a hedge against inflation, a store of value, and an alternative to traditional financial instruments, Bitcoin’s appeal has surged among major players in the financial world. This growing adoption is a key factor in Bitcoin’s price reaching new highs, underpinned by its integration into treasury strategies, investment portfolios, and payment systems.

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Bitcoin Officially Breaks $100,000: 4 Key Drivers Behind the Milestone

Ondo Finance has launched a new institutional-grade bridging solution for tokenized real-world assets (RWAs), leveraging LayerZero’s decentralized verifier network (DVN) for enhanced security.

The S&P 500 rose 0.57% to a record high, driven by investor focus on upcoming inflation data, despite concerns over new tariff threats and the Federal Reserve's cautious stance on rate cuts.  Coindesk Indices, an index measuring broader cryptocurrency market performance was down by 2.60%, with Bitcoin and Ether dropping by 4.08% and 3.27%, respectively in the past 24 hours.

Today's top performer is FTM, which surged 9.9% following Sonic Labs' partnership with OctavFi for advanced on-chain financial management.

Sonic Labs (FTM), founded in 2018, formerly known as Fantom Foundation, supports the development of Sonic, a new layer-1 blockchain designed for fast, efficient transactions and secure connectivity to Ethereum. It focuses on creating decentralized applications and managing governance for the Sonic ecosystem, which is set to launch later in the year. 

 to bring institutional-level financial management, advanced on-chain treasury management, and financial reporting to its protocols.

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 a new institutional-grade bridging solution for tokenized real-world assets (RWAs), leveraging LayerZero’s decentralized verifier network (DVN) for enhanced security. This solution enables seamless transfers of USDY, Ondo’s yield-bearing tokenized US Treasuries, across Ethereum, Arbitrum, and Mantle. The bridging architecture incorporates trusted bridge providers like PolyhedraZK and Axelar, along with Ondo’s own DVN, ensuring secure and decentralized transaction validation. The integration is available now via Ondo’s frontend and Stargate Finance, with support for additional chains planned.

Yesterday, BTC spot ETF flows recorded a total outflow of $122.8M, including $36.1M from GBTC and $86.7M from non-GBTC funds.

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Ondo Launches Institutional-Grade Bridging for Tokenized RWAs with LayerZero Security

How to Use the Bybit Card to Earn 15% Cashback on Top of All Black Friday Deals

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How Can You Use the Bybit Card to Earn 15% Cashback on Top of All Black Friday Deals?

Bitcoin Hits New All-Time Highs: 8 Things Trump Is Saying About Cryptocurrency and What It Means for Bitcoin and Altcoins

With Bitcoin and the total cryptocurrency market cap surging to highs- returning to its 2021 peak—many are attributing this renewed bullish momentum to Donald Trump’s recent U.S. election victory. In this article, we’ll explore 8 key promises and policies Trump has put forth for the sector and the potential impact on both blue chip and meme coin cryptocurrencies.

Donald Trump & Crypto: The Bull Case for The Sector

The newly elected U.S. President, Donald Trump, has outlined a series of plans for the cryptocurrency sector, signaling major shifts in U.S. policy. With the United States accounting for approximately 

, U.S. policy and leadership play a significant role in shaping the sector. Here are eight key takeaways and promises from his proposed initiatives:

These factors collectively contribute to a positive outlook for the cryptocurrency sector under the current administration.

The election outcome has also positively influenced blue-chip cryptocurrencies:

Trump's win has significantly impacted the meme-coin sector. Following the victory,

 surged by 145%, outperforming Bitcoin and Ethereum in growth. This rally reflects heightened speculation that Trump's pro-crypto regulatory stance could indirectly support meme-coins, which are often driven by community engagement and viral appeal. Meme-coins, while volatile, present high-risk, high-reward opportunities, and recent events have drawn increased attention from traders looking to capitalize on this momentum.

Capitalizing on Trump’s Win and Riding the Crypto Wave

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Crypto Insights

Institutions still favor Bitcoin over Ether, even though the latter is likely getting a green light from the SEC for its Spot ETFs. 

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Bybit Data: Institutions Continue to Favor Bitcoin

Following the approval of Bitcoin Spot ETFs on January 10, 2024, Bitcoin’s price saw a 46% increase in February 2024 and peaked in mid-March with an all-time high of $73.7K. Despite the pullback in April and rebound in May, institutional holdings of Bitcoin continued to increase persistently throughout the half-year period. 

On the other hand, Ether’s position by institution saw a surprising decrease in May 2024, dropping from 10.8% on April 30, 2024, to 9.9% on May 31. Institutions have been acting as the smart money this time, with their Ether positions increasing in April as the market lost faith in the SEC’s ETF approval, and reducing in the wake of the approval.

In short, institutions still favor Bitcoin over Ether, even though the latter is likely getting a green light from the SEC for its Spot ETFs. The reasons behind this are likely a combination of TradFi’s accumulation of Bitcoin and the subdued attraction of Ether Spot ETFs.

Impact of TradFi’s Accumulation of Bitcoin

BTC Positions From Top Hedge Funds Are Quite Small

Following Bitcoin Spot ETF approvals in January 2023, the 13F reports for Q1 2024 are the first of their kind to be released that cover the position change for traditional asset managers. 

It’s surprising that over half of the top 25 hedge funds invested in Bitcoin Spot ETFs in the first quarter of 2024. 

Top Hedge Funds’ Bitcoin Position % as AUM. Source: Bybit

While Bitcoin wasn’t dominant, its presence in the portfolios of major hedge funds is still significant. For example, at Millennium Management, Bitcoin Spot ETFs, including IBIT and FBTC, account for the 18th-largest position in the firm's portfolio, comprising over 0.3% of its total assets under management (AUM).

This suggests that even traditional, non-crypto-focused hedge funds are starting to view Bitcoin as an attractive investment. Known for their flexibility and embrace of volatility, hedge funds may be drawn to Bitcoin due to its potential for outsized returns as compared to more traditional asset classes.

Prior to the recent disclosure of these 13F filings, crypto-native hedge funds had been the primary institutional buyers of Bitcoin. However, the fact that mainstream, non-crypto hedge funds are now accumulating Bitcoin positions speaks to the growing market optimism around Bitcoin Spot ETFs.

These ETFs provide established asset managers with regulated investment vehicles to gain exposure to Bitcoin, which offers unique investment characteristics, such as its limited supply and lack of correlation with other asset types. As such, Bitcoin is clearly gaining recognition among a wider range of institutional investors — even if it remains a relatively small part of their overall portfolios for now.

Once Traditional Asset Classes Are Starting to Invest in Bitcoin — And It Won't Be a One-off Event

It's unlikely that investors have already allocated their full targeted exposure to Bitcoin in the first quarter of 2024. The true extent of their positions will likely become clearer when the next round of 13F filings is released in mid-August.

Traditional hedge funds, in particular, probably haven’t invested their entire desired Bitcoin allocation so far this year. This is especially true given that Bitcoin has continued to set new all-time highs, making current investment costs less appealing from a trading perspective.

Instead, the Bitcoin positions we've seen reported so far in Q1 2024 are likely just initial stake-building by these institutional players. Hedge funds, with their typical 5-year investment horizons, are usually more focused on buying low and selling high to maximize returns; they aren’t the 

ers that some other crypto investors have become. In particular, the lowest Bitcoin price point observed so far in Q1 2024 has only been around $58,000. This relatively mild drawdown may not have provided a sufficiently attractive entry point for these sophisticated investors to deploy their full intended allocations.

We'll likely get a better sense of hedge funds' true Bitcoin exposures and strategies when the next round of regulatory filings is disclosed in mid August. The current data only provides a partial glimpse into institutional crypto adoption trends.

When it comes to Bitcoin Spot ETF investments, we believe pension funds stand out as some of the most impressive institutional players. As long-term, risk-averse investors, pension funds are poised to be the true HODLers in this space.

Based on the latest 13F filings, Wisconsin Investment Board appears to be one of the few pension funds that’s been allocated to Bitcoin Spot ETFs so far. This makes sense, as pension funds generally have much longer investment horizons as compared to more active traders, such as hedge funds.

Similar to the way that hedge funds are approaching Bitcoin, we don't believe Wisconsin's investment in the Bitcoin Spot ETF is a one-off. Just as Warren Buffett gradually built up Berkshire Hathaway's position in Apple over 2016 and 2017, we expect pension funds to increase their Bitcoin exposure methodically over time.

Another potentially significant source of long-term Bitcoin investment could come from corporate America. While early movers like MicroStrategy and Tesla have already allocated corporate treasury funds to Bitcoin, we may see more firms follow suit and use Bitcoin Spot ETFs as a way to hold the cryptocurrency.

 cash balance to direct Bitcoin holdings, rather than through an ETF. However, holding Bitcoin via a Spot ETF could be an easier option for many corporations looking to reduce custody and counterparty risks.

Cash held by Corporate America (Feb 2024). Sources: Harvard Business Review, Bybit

The data presented in the table above suggests that if corporate America were to allocate just 5% of its aggregate cash reserves into Bitcoin, that would be equivalent to 25.5% of Bitcoin's total market cap. This highlights the sheer scale of the potential demand that could be unleashed if more major corporations start treating Bitcoin as a treasury reserve asset, in a similar fashion to early movers like MicroStrategy and Tesla.

Will Bitcoin Continue to Outperform Ether?

Bitcoin Dominance Halts Since 19b-4 Approval of Ether Spot ETFs

The ETHBTC ratio has been in a downtrend since September 2023, likely due to anticipation of Bitcoin Spot ETF approvals. It briefly bounced above 0.05 in January after the BTC ETF launch, as investors betted on an upcoming Ether Spot ETF.

However, the ratio has since continued falling, only recently bottoming out as Ether Spot ETFs near approval. At 0.053, the current ETHBTC level remains well below historical averages, indicating Bitcoin's outperformance.

Ether Spot ETFs Are Unlikely to Repeat Bitcoin Spot ETFs’ Success

Approval of 19b-4 documents by the SEC was an initial step toward the eventual approval of Ether Spot ETFs. The market expects the SEC will need to sign off on the registration statements, known as S-1s, submitted by the fund issuers, likely sometime this summer.

The key question is whether we'll see another rally in Ether and other cryptocurrencies after the expected ETF approval in July 2024.

In the lead-up to the SEC's green light, Ether jumped from $3,000 to $3,700 — a 20% increase as compared to just an 11% rise in Bitcoin over the same period. This narrowed the performance gap between the two largest cryptocurrencies.

In our view, the market has largely priced in the approval of an Ether Spot ETF, as there are no major uncertainties surrounding this imminent event. Compared to Bitcoin's gains since Q4 2023, Ether has only about 30% room to catch up.

However, the SEC's specific classification of Ether as a commodity or security in its official ETF approval could still fuel another rally, as the market may then anticipate approval of similar ETFs for Solana, XRP or other altcoins.

It's also worth noting approved Ether Spot ETFs will likely lack a staking feature, per the revised application forms. This may drive some traditional financial institutions to consider holding Ether directly through regulated custodians, rather than a Spot ETF.

In our view, both Bitcoin and Ether will continue to see price appreciation as more crypto ETFs launch, with the broader crypto market likely remaining highly correlated.

 from Bybit Institutional suggests that Bitcoin and Ether are the mainstay assets in institutional portfolios. Therefore, the slight outperformance of Bitcoin against Ether may not make a huge difference to the overall returns of these diversified crypto holdings.

Looking ahead, Bitcoin may likely continue to be the preferred choice for traditional finance (TradFi) institutions newly entering the crypto market, given its status as 

In contrast, Ether's positioning as the "app store" of the crypto ecosystem may not be as unique an attribute for these TradFi players. Many Web 2.0 companies have stronger fundamentals than those of applications built on Ethereum, which also faces intensifying competition from other Layer 1 protocols.

Bitcoin Bull Rally Persists, Likely Due to Institutional Accumulation; Bitcoin Might Outperform Ether Near-Term

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