After the latest U.S. inflation data reinforced expectations for further interest rate cuts by the Federal Reserve, Bitcoin has once again broken through the $100,000 mark.
On Wednesday (December 11), Bitcoin rose nearly 5% in the U.S. market, marking the largest increase in two weeks, before slightly retreating, with the latest trading on Thursday around $101,000. Smaller cryptocurrencies traded within a relatively narrow range.
U.S. president-elect Donald Trump announced the repeal of the Biden administration's crackdown on cryptocurrencies and will instead pursue a more lenient regulatory policy, leading to Bitcoin reaching a record $103,800 on December 5. However, thereafter, due to profit-taking by speculators, Bitcoin struggled above the $100,000 mark.
Last month's U.S. consumer price inflation data met expectations, strengthening investor expectations for the Federal Reserve to lower borrowing costs next week. The prospect of a loose monetary policy boosted market sentiment, propelling the tech-heavy Nasdaq 100 index to a historic high.
The market reacted positively to expectations of inflation data, with Henry Elder, head of UTXO Management, noting that traders are assessing whether the $100,000 price is a ceiling or a floor. Trump's supportive policies and strategic reserve plan, in addition to easing regulatory policies, also advocate for establishing a national Bitcoin strategic reserve, although the feasibility of this proposal is widely questioned. Eric Trump, the son of the president-elect, stated in a Bloomberg TV interview that his father will become a 'strong supporter of the industry.'
Although Trump was previously skeptical about digital assets, his views changed as the industry invested heavily in lobbying during the U.S. elections. This Republican now has his own projects in the crypto space, which is controversial due to its volatility, fraud, and criminal activities.
Since Trump won the U.S. presidential election on November 5, Bitcoin's market price has risen by about 50%, while the net inflow of the U.S. spot Bitcoin Exchange-Traded Fund (ETF) during the same period was about $11 billion. Other cryptocurrency-related products, such as Ethereum, also attracted $2.4 billion in capital inflow.
In 2021, the cryptocurrency market experienced a super bull market, and SHIB benefited from it, with prices soaring. In October of that year, its price peaked at around $0.000088, which was astonishing compared to its nearly negligible price at launch; it was a rocket-like increase. The entire crypto community was cheering for SHIB, and many made a fortune due to early investments.
From a positive perspective, there are indeed some favorable factors. The changes in market environment we mentioned earlier, the advancement of technological projects, and the popularity of social media are all driving its development. If the cryptocurrency market can continue to maintain its current active state, the SHIB development team can advance projects as planned, and the popularity of social media remains high, then there is a possibility of breaking through $0.00004. Just imagine, if it really happens, it would be a grand celebration for investors holding SHIB.
Those who bought in at low prices may reap substantial returns and even achieve small goals of financial freedom. The price fluctuations of Bitcoin can affect the overall market trend, and SHIB, as a relatively niche cryptocurrency, is more susceptible to market sentiment. If a global economic crisis or policy adjustment suddenly occurs, such as a country strengthening regulations on cryptocurrencies, banning trading or mining, then the entire cryptocurrency market could be severely impacted, and SHIB would find it difficult to remain unscathed.
