Bitcoin, which has rallied over 115% year-to-date, is enjoying a triumphant year — following the approval of the Spot Bitcoin ETF in January, which saw prices breach US$60,000 ($80,324) in early March, and crossing US$70,000 on March 8. Speculations that the most valuable cryptocurrency by market capitalisation could reach US$100,000 by the end of the year flooded headlines.
The highly anticipated “halving” event happened on April 19, which was expected to give prices a further boost. However, the cryptocurrency only recorded a modest gain that day and closed at US$63,821.
Bitcoin’s price — which purists have argued is correlated to its cost of production, its utility as a store of value or its intrinsic value — has proven to be more correlated to real-world affairs, particularly in 2024. As recent price movements have shown, the prospect of Donald Trump taking office again has an influence on cryptocurrencies as well.
Pro-crypto Trump
Trump positioned himself as the pro-crypto presidential candidate during his campaign. He promised to establish a strategic national crypto stockpile, remove the anti-crypto US Securities and Exchange Commission (SEC) chairman Gary Gensler, and encourage Bitcoin mining within the US.
His victory promptly triggered a surge in prices, and as of Nov 20, Bitcoin stood above US$92,000. Days after the election, Trump unveiled that billionaire space entrepreneur Elon Musk will co-head a new department called the Department of Government Efficiency (Doge), a nod to Musk’s favourite cryptocurrency Dogecoin, which is also the only cryptocurrency that can be used to pay for electric vehicles made by Musk’s Tesla.
“Trump’s stance on reducing regulatory friction for digital assets has injected a new wave of confidence among investors. This momentum could push Bitcoin into the top ranks of global assets, surpassing major corporations, such as Amazon, within a matter of weeks,” says Nigel Green, CEO of deVere Group.
See also: Bitcoin retreats from US$100,000 in worst spell since Trump’s win
The group, which was previously embroiled in controversy over losing the retirement savings of overseas British citizens, has predicted that Bitcoin, with a total value of US$1.8 trillion at the moment, could surpass e-commerce giant Amazon.com Inc’s US$2.15 trillion market capitalisation as soon as 2025, given how the former’s potential appears almost “boundless”, says Green.
These trends signal the rise of digital assets as an integral part of the global economy, challenging long-held norms about asset valuation and financial security. “If Bitcoin overtakes Amazon’s valuation, it will signify more than just a record price — it will represent the evolution of the financial landscape itself,” says Green.
This week, Bitcoin is again looking at an all-time peak, supported by a series of developments highlighting the deepening embrace of the digital asset industry in the US under Trump. His media group, Trump Media and Technology Group Corp, is reportedly in talks to buy digital-asset marketplace Bakkt Holdings Inc, sparking a surge in the share prices of both companies.
See also: Singapore Gulf Bank to raise funds, buy stablecoin payments firm
“[Bitcoin’s] new all-time high underscores the positive impact of supportive developments within the crypto landscape and highlights the increasing alignment of digital assets with global financial trends,” says Richard Teng, CEO of crypto exchange Binance. He adds that Binance has always believed that crypto has a bright future and is optimistic about the industry’s outlook.
With the onset of Trump’s policies, pundits and industry watchers have been betting on the next goal for the coin. Price predictions, once commonplace in Bitcoin’s previous rallies, have since dwindled as the relationship between big crypto players and global regulators improve.
Bitcoin US$ prices, 2024 year-to-date. Chart: Bloomberg, as of Nov 20, 2024
US$250,000 next?
Standard Chartered’s head of FX research, Geoff Kendrick, expects Bitcoin to “overshoot” to a high of around US$250,000 this year if ETF inflows continue apace. Kendrick, unusually bullish on this asset class relative to other mainstream financial industry pundits, has been making price predictions for Bitcoin consistently. In 2023, he said that Bitcoin could hit US$100,000 by end-2024.
Kendrick uses three measures to assess where Bitcoin prices might go. First is the gold analogy. This is based on gold price moves after US gold exchange-traded products were introduced, which Kendrick estimates that Bitcoin could rise to US$200,000 apiece.
The second is two-asset (gold and Bitcoin) optimisation, which suggests a level of around US$190,000 apiece, based on an optimised 80% gold at current prices and a 20% Bitcoin portfolio.
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Observers say that much of the bullishness around Bitcoin this year is related to the growing level of institutional confidence in the coin, as evidenced by the rally in January when Spot Bitcoin ETFs were approved.
Sygnum, a digital asset banking group licensed in both Singapore and Switzerland, says that interest among institutional investors gaining exposure to the asset class via spot or other investment vehicles has been trending upwards since the US elections.
“One of the starkest differences this time [compared to previous bull runs] is the level of maturity exhibited by institutional investors and how the industry has grown in so many markets globally,” says the firm’s executive director of clients, Jason French.
“We now have clear regulatory frameworks established in many key jurisdictions, technical improvements that enable real-world use cases at scale with real economic activity happening on-chain, advanced forensics techniques to reduce nefarious activities, and a plethora of applications across different verticals showing strong growth,” he adds.
Teng: [Bitcoin]’s new all-time high underscores the positive impact of supportive developments within the crypto landscape and highlights the increasing alignment of digital assets with global financial trends. Photo: SFF
Thaws seen at SFF
At the Singapore Fintech Festival (SFF) this year, a panel featuring six individuals spanning the cryptocurrency industry to global financial regulators sat down to discuss the topic of “digital currencies in a billion wallets”, or what is dubbed as the “The Big Hairy Audacious Goal (BHAG)” — a business term used to motivate finance teams to plan for long-term success.
The Monetary Authority of Singapore (MAS)’s chief fintech officer, Sopnendu Mohanty, opened the session on Nov 8 with price charts of different cryptocurrencies such as Bitcoin and Ripple’s XRP coin plastered on the screen. “Why should we all get excited about this growing trend — I’m going quite out of my comfort zone there…” he began.
The MAS has historically taken a hardline approach to entities promoting the speculation of cryptocurrencies. It has repeatedly said that cryptocurrencies have no real store of value, with former managing director Ravi Menon declaring at the 2023 SFF that “privately issued crypto has failed as medium of exchange”.
Besides Teng of Binance, the panellists included Charles Cascarilla, co-founder and CEO of Paxos; Eric Anziani, president and COO of Crypto.com; Monica Long, president of Ripple and Sarah Breeden, Bank of England’s deputy governor.
“2024 has been a huge landmark year [for the crypto space],” says Teng, who has only taken over as chief executive of Binance for a year from the exchange’s founder Zhao Changpeng. The Singaporean held previous roles at the MAS, the Singapore Exchange S68 and the Abu Dhabi Global Market.
“Our platform now has close to 240 million users globally. The first 100 million users took us almost five years. The next 100 million took us roughly 26 months. Year-to-date, we have onboarded about 60 million,” says Teng. The approval of the Spot Bitcoin ETF has paved the way for institutions to participate in the space, and with greater regulatory clarity in the US and other parts of the world, the pace of adoption is going to quicken, the CEO adds.
In 2021, a public altercation between Binance and MAS paved the way for tighter watch over crypto exchanges by the Singapore authorities. Binance promptly announced the withdrawal of its application for a crypto permit to operate in the city-state, and eventually shut its operations in the city. MAS, on its part, placed Binance on the Singapore’s Investor Alert List (IAL) while investigating the exchange after it received complaints between January and August 2021.
The appearance of Teng and Mohanty of MAS at the same panel at the SFF three years later may signal improving relations between the two.
Mohanty took turns to question each panellist about what clarity they sought from regulators, to give one compelling use case for “a billion crypto wallets”, and their opinion about the overwhelming number of “bad actors” in the crypto industry.
“I do think that a lot of vulnerabilities are sometimes introduced by regulators because of a lack of understanding of the sector,” says Teng. “This year, quite a lot of exchanges were hacked, including Indian exchange WazirX — which had third-party custody and was licensed.”
Teng, in a bid to close the gap between crypto exchanges and MAS, continued to say more education between the two parties is required, so that better understanding of vulnerabilities and innovations can materialise.
