Bitcoin hits all-time high, $100,000 expected this year

Gold has reached a record high, the US has reached a record high, and Bitcoin is also about to reach a record high. What happened? Why is capital strongly buying BTC?

There is only one week left until the 2024 US presidential election. At present, the economic, financial, trade and geopolitical situation around the world is full of uncertainty, so this US election will have a significant impact on the capital market and even the future global pattern. In this context, safe-haven assets such as gold and Bitcoin are favored by investors. The prices of the two have continued to rise, becoming the first choice for funds to avoid risks.

Analysts at StarEx Exchange believe that the continuous decline in U.S. Treasury bonds has led to a surge in yields. At the same time, the continuous rise in gold, Bitcoin, and U.S. stocks is a continued stubborn pricing of U.S. debt expansion and inflation. After all, trillions of real money and silver are being bet.

From the perspective of the global economic environment, major economies are also facing severe challenges. The high inflation problem in the United States has not yet been solved, Europe is plagued by energy crises and inflation, and the economic growth of emerging market countries has slowed down, and the debt problem has become more serious. Under this global uncertainty, the capital market has a stronger demand for safe-haven assets. As a traditional safe-haven asset, gold has once again attracted a large amount of capital inflows, while Bitcoin has gained more and more recognition because it is regarded as "digital gold". As Bitcoin continues to rise, Bitcoin ETFs have also received massive purchases of funds.

The capital market is even more worried about Trump's election. Trump's economic policy has always been centered on "America First", especially his proposed tariff policy, which, if implemented, will lead to higher import costs, thereby pushing up domestic prices and exacerbating inflationary pressure. At the same time, his labor policies, such as the deportation of illegal immigrants, may lead to labor shortages in some industries, which in turn will push up corporate costs and indirectly push up prices. In order to deal with these problems, Trump tends to rely on the Federal Reserve to cut interest rates to ease economic pressure through monetary easing.

At present, the Federal Reserve is in a dilemma under the dual pressure of inflation and economic growth. The scale of US debt has reached a record high. In a high-interest rate environment, interest payments have become a major burden for the federal government. Although high interest rates help to curb inflation, they also greatly increase the government's debt burden. When campaigning for Trump, Tesla boss Elon Musk mentioned that the growth rate of US debt has been too rapid in a high-interest rate environment, and measures must be taken to alleviate this pressure. Since the US government's fiscal situation cannot be maintained under long-term high interest rates, the market has gradually formed a consensus: tolerating a certain degree of inflation may be the only realistic way to reduce debt.

StarEx Exchange analysts believe that as the market expects inflation to be unavoidable, anti-inflation assets such as gold and Bitcoin will naturally be sought after by funds. The market generally believes that if Trump is elected and his policies trigger further inflation, while economic growth slows or even stagnates, gold and Bitcoin may usher in a bull market cycle for several years. The dual push of safe-haven demand and inflation expectations will keep the prices of these assets rising, making them a "safe haven" in the eyes of global investors.

As Bitcoin is about to break through its all-time high, funding rates and ETF trading volumes are still below March 2024 levels, which means that the crypto market is still waiting for a shot in the arm, that is, Trump's confirmation of election.

Analysts at StarEx Exchange believe that Bitcoin will definitely break through $100,000 in 2024 and start a long-term bull market, so they should hold on firmly.