Bitcoin Price Surges Again: What Drives the Price Increase? What Do Analysts Think?

Amid increasing expectations that President Donald Trump will support cryptocurrency in his second term, Bitcoin is regaining momentum, preparing for its largest weekly gain since the US election in November. The world's largest cryptocurrency by market capitalization has risen nearly 12% since Sunday to $104,668, a 4.96% increase in a day. The price surge comes after a mixed performance that saw Bitcoin decline in three out of the past four weeks. BTC had previously reached an all-time high of $108,315 in December.

Zaheer Ebtikar, founder of the Split Capital cryptocurrency fund, said, "The market is currently pricing in Trump taking office and Trump will be optimistic about cryptocurrencies". According to Bloomberg, Trump plans to issue an executive order prioritizing BTC as part of his administration's policy agenda. This order is expected to promote a more comprehensive dialogue with industry leaders and signal a change from his previous skeptical stance on cryptocurrency. The Bitcoin price increase this week coincided with a broader increase in risk assets as concerns about inflation eased in the US. Weaker-than-expected Producer Price Index (PPI) and Consumer Price Index (CPI) data have fueled investor optimism about the Federal Reserve continuing to cut interest rates. Jake Ostrovskis, a trader at Wintermute, a cryptocurrency market maker, said: "Lower PPI and CPI indices have removed macroeconomic concerns, allowing investors to focus on specific catalysts for cryptocurrencies". However, Ostrovskis warns of the possibility of volatility in the market as Trump's inauguration approaches. Ostrovskis added, "The options market shows that traders are betting on higher volatility at the end of January, meaning the market could run ahead of the inauguration on Monday". DYOR! #Write2Earn #Write&Earn $BTC {spot}(BTCUSDT)