Bitcoin breaks above $88,000, rising over 11% in a day, Bitcoin ETF size surpasses gold

On Monday during U.S. trading hours, the cryptocurrency rally triggered by Trump's victory in the U.S. presidential election continued. Bitcoin started a fierce rally over the weekend and accelerated its rise on Monday, breaking through several key levels during the session, currently surpassing the $88,000 mark, with a 24-hour increase of over 11%.

Major cryptocurrencies by market capitalization surged across the board. Ethereum and Solana both saw a cumulative increase of about 40% over the past week, surpassing Bitcoin's 31%, while Dogecoin, supported by Musk, doubled in value over the week.

The premium on Bitcoin futures skyrocketed, as investors are optimistic about the positive effects brought by Trump's election as president. According to data from the derivatives exchange Deribit, bets on Bitcoin breaking through $90,000 exceeded $2.8 billion.

On the same day, Bitcoin holder MicroStrategy announced that it spent approximately $2.03 billion to purchase about 27,200 Bitcoins, marking the largest buy order since December 2020.

Previously, on October 30, alongside the release of its third-quarter report, MicroStrategy announced a "21/21 plan," which aims to raise $42 billion over the next three years through $21 billion in equity and $21 billion in bonds to purchase more Bitcoin.

On Monday, during U.S. stock trading, the asset management scale of the Bitcoin ETF IBIT under BlackRock surpassed that of one of the largest gold ETFs, iShares IAU. Although IBIT's current asset management scale is still about $30 billion less than that of the world's largest gold ETF, SPDR Gold Shares GLD, its surpassing of IAU is considered a milestone event.

According to FactSet data, over the past week, IBIT received approximately $1 billion in inflows, and since its launch in January of this year, the ETF has recorded a total inflow of $27 billion. The rise in Bitcoin prices has pushed the ETF's asset management scale to over $30 billion.

As of last Friday, the asset management scale of the Bitcoin ETF IBIT was $34.3 billion, while IAU's asset management scale was slightly below $33 billion. The asset management scale has not yet reflected the surge in Bitcoin over the weekend and Monday.

Cryptocurrency concept stocks/blockchain concept stocks generally rose on Monday, with several leading stocks surging. By the close of the day, Canaan Inc. ADR rose over 41%, MARA Holdings rose nearly 30%, Coinbase rose nearly 20%, reaching an intraday high not seen since November 2021, MicroStrategy rose over 25%, hitting an intraday all-time high, and the double-leveraged Bitcoin ETF rose over 27% Wall Street generally believes that Trump's commitment to fully engage in the cryptocurrency sector has driven Bitcoin prices to new heights. Trump has vowed to make the United States the world's cryptocurrency capital. Bitcoin speculators are betting on a more relaxed regulatory environment and anticipate that authorities may establish a cryptocurrency reserve fund to help boost ongoing demand.

Citigroup strategists pointed out in a recent report:

Cryptocurrencies are one of the few Trump trades that have not retraced. Part of the reason is the Trump administration's friendly stance towards cryptocurrencies, and investors hope this will lead to clarity in U.S. regulatory policies.

Since the election, the inflow of funds into spot cryptocurrency ETFs has reached an all-time high. Two days after the U.S. election, the net inflow of funds into BTC and ETH ETFs was $2.01 billion and $132 million, respectively. Citigroup continues to view ETF flows as a major driver of Bitcoin returns.

Chris Newhouse, head of research at Cumberland Labs, stated that Bitcoin continues to exceed expectations and set new highs. The market seems to finally realize that we are entering an undeniable bull market in the coming years.

Looking ahead, some analysts expect cryptocurrencies to continue rising, with some analysts predicting that Bitcoin is expected to reach the significant milestone of $100,000 by the end of the year.