The cryptocurrency market experienced a surge of excitement on Thursday as Bitcoin (BTC-USD) momentarily surpassed the $100,000 mark. This milestone followed President-elect Donald Trump’s announcement to nominate Paul Atkins, known for his crypto-friendly stance, to lead the US Securities and Exchange Commission (SEC). This news ignited a rally in crypto-related stocks, albeit a short-lived one.
Bitcoin reached a peak of $103,500 in early trading on Thursday before retreating below the $100,000 threshold later in the day. This volatility underscores the sensitivity of the crypto market to regulatory developments and news surrounding key figures.
Coinbase (COIN), a major cryptocurrency exchange platform, saw its stock price initially jump by 5% on the news. However, by the end of the trading day, it had reversed course, closing down over 3%. Despite this recent setback, Coinbase shares have still achieved impressive year-to-date gains exceeding 80%.
MicroStrategy (MSTR), a software company renowned for its significant Bitcoin holdings, also experienced a similar trajectory. Its stock initially climbed over 8% before ultimately falling nearly 5% by market close. Riot Platforms (RIOT), a Bitcoin mining company, mirrored this pattern with an early 6% surge followed by a similar decline. These fluctuations highlight the interconnectedness between Bitcoin’s performance and the fortunes of companies heavily invested in the cryptocurrency space.
Prior to this market event, Owen Lau, a senior analyst at Oppenheimer, had cautioned investors about the potential for selling pressure once Bitcoin reached the $100,000 level. He suggested that investors might look for the next breakout level after such a significant milestone.
Atkins’ nomination is particularly significant given his contrasting approach to cryptocurrency regulation compared to outgoing SEC Chair Gary Gensler. Gensler spearheaded a period of intensified scrutiny and enforcement actions against the crypto industry, targeting alleged fraud and unregistered activities. These actions ranged from fines against smaller brokers to high-profile cases involving major players like FTX, Coinbase, and Binance.
While supporters of Gensler’s approach believed it necessary to address questionable practices within the crypto sector, critics argued that his aggressive tactics stifled innovation. This debate underscores the ongoing tension between fostering innovation and ensuring regulatory compliance within the rapidly evolving landscape of digital assets. Atkins, in contrast, is expected to advocate for regulations that encourage innovation and avoid what he perceives as excessive oversight.
Trump’s election has generally been viewed positively by the crypto community. His attendance at a major Bitcoin conference during his campaign, coupled with the pro-crypto sentiments expressed by Vice President-elect JD Vance and other potential Cabinet members, has fueled optimism about a more favorable regulatory environment under his administration. There are even reports that Trump’s team is considering the creation of a “crypto czar” position within the White House to specifically address Bitcoin policy.
