Bitcoin (BTC) continues its record-breaking ascent, fuelled by a combination of market enthusiasm, institutional adoption, and pro-crypto regulatory developments. As it surpasses $98,000 for the first time, Bitcoin is edging closer to the psychological milestone of $100,000, driven by surging interest in Bitcoin exchange-traded funds (ETFs) and the promise of a supportive political landscape.

Bitcoin ETFs surpass $100 billion in assets

Bitcoin ETFs in the United States have reached a historic milestone, collectively managing over $100 billion in assets for the first time. These funds have played a pivotal role in Bitcoin's remarkable 120% price surge since the start of 2024. The recent milestone reflects the growing institutional acceptance of Bitcoin as a mainstream investment. Investor interest has surged following the election of Donald Trump, whose perceived pro-crypto stance is expected to bring further clarity and support to the industry.

BlackRock's iShares Bitcoin Trust (IBIT) leads the charge, attracting $30 billion in net inflows since its January launch, surpassing even BlackRock's flagship gold ETF. Fidelity's Wise Origin Bitcoin Fund (FBTC) follows closely, with inflows exceeding $11 billion this year. These developments underscore Bitcoin's increasing relevance in the financial ecosystem as the total assets under management (AUM) of Bitcoin ETFs rapidly approach the $120 billion managed by gold ETFs.

Eric Balchunas, an ETF analyst at Bloomberg Intelligence, highlighted the transformative nature of Bitcoin ETFs, noting that they are closing in on becoming the largest single holder of Bitcoin while challenging gold ETFs' dominance. The surge reflects a broader "debasement trade" as investors seek refuge in assets like gold and Bitcoin amidst rising inflationary and geopolitical concerns.

To $100K and beyond

With new records being smashed by the day, many market participants are anticipating that BTC's price will finally break the $100,000 barrier, a key psychological threshold that would more than vindicate all the Bitcoin believers and hodlers that continued to invest in digital assets through all the highs and lows of recent years.

Analysts predict this growth will continue, with some projecting Bitcoin's value to reach between $150,000 and $200,000 by 2025. Betting platform Polymarket has 92% of bets on Bitcoin reaching a six-figure price, and the latest 'black book' from the respected research broker firm Bernstein projects that BTC will hit $200,000 next year.

Institutional investment drives growth

In the US, Senator Cynthia Lummis's proposal to establish a national Bitcoin reserve, which would buy up to 5% of Bitcoin's total supply over five years, is just one sign of just how traditional institutions are cosying up to Bitcoin. Although proposals like these may be little more than flirtations, they show an awareness on the part of politicians that crypto investors now represent a significant section of the voting population and that their support is worth courting.

The bullish sentiment is supported by aggressive purchasing strategies by companies like MicroStrategy, which plans to raise $42 billion for Bitcoin acquisitions over the next three years.

BlackRock also debuted new IBIT options to strong demand. These Bitcoin spot ETF options recorded $2 billion in trading volume on their first day, with over 73,000 contracts traded within the first hour and placing IBIT among the top 20 most actively traded non-index options globally. The bullish call-to-put ratio of 4.4:1 underscores institutional investors' confidence in Bitcoin's potential as a mainstream asset.

Post-halving cycles project prices past $150K

Regression models also suggest a peak of $150,000 in this bull cycle, aligning with historical post-halving patterns. Past halvings have driven Bitcoin prices up by 8,000% in 2012, 2,900% in 2016, and 560% in 2020. If Bitcoin follows a similar trajectory after the April 2024 halving, a 300–400% rally could place its price between $150,000 and $200,000.

Potential pullbacks

While optimism remains high, the $100,000 mark is widely regarded as a psychological barrier. Analysts caution that this level could trigger profit-taking, leading to a potential correction. Historical patterns suggest Bitcoin could retreat to its 50-week exponential moving average (EMA), currently around $60,000, before resuming its upward trajectory. Such a pullback would align with similar market behaviours seen during previous bull cycles, presenting a consolidation phase before further growth.

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