Bitcoin vaults to all-time peak as Trump election raises crypto excitement

London/New York: Bitcoin surged to a record above $87,000 on Monday in a blistering rally amid expectations cryptocurrencies will thrive in a light-touch regulatory environment following the election of Donald Trump as US president and pro-crypto candidates to Congress.

The world's biggest and best-known cryptocurrency has more than doubled from the year's low of $38,505 and was last at $87,079, up nearly 9 per cent from late on Sunday, having earlier touched a record high of $87,460.

US-listed cryptocurrency stocks also surged, with crypto exchange Coinbase Global jumping 22 per cent and iShares Bitcoin Trust up 13 per cent.

Crypto miner Riot Platforms surged 19 per cent, while MicroStrategy, one of bitcoin's biggest corporate backers, gained nearly 24 per cent.

Trump embraced digital assets during his campaign, promising to make the United States the "crypto capital of the planet" and to accumulate a national stockpile of bitcoin.

"The outcome of the 2024 US election is a renaissance moment for the crypto industry," Jeff Dorman, chief investment officer and co-founder of asset manager Arca, said in a research note.

"Events in crypto with this level of significance are rare. When they happen, they immediately expand the world's collective outlook about the potential of the crypto movement and where this technology will take the world going forward."

Short sellers of cryptocurrency and blockchain-related stocks have suffered heavy losses since Nov. 6, after bitcoin surged to record highs. Combined short-selling losses on Coinbase, crypto miners Riot Platforms and MARA Holdings, as well as blockchain-farm operator Bitfarms were about $1.2 billion, as of the Nov. 8 close.

End to crypto scrutiny

Crypto investors see an end to increased scrutiny under US Securities and Exchange Commission Chair Gary Gensler whom Trump has said he will replace.

The cryptocurrency industry spent more than $119 million backing pro-crypto congressional candidates, many of whom won their races.

In Ohio, one of the crypto industry's biggest foes in Congress - Senate Banking Committee Chair Sherrod Brown - was ousted, while pro-crypto candidates from both the Democratic and Republican parties won in Michigan, West Virginia, Indiana, Alabama and North Carolina.

Trump also unveiled a new crypto business, World Liberty Financial, in September. Although details about the business have been scarce, investors have taken his personal interest in the sector as a bullish signal.

Billionaire Elon Musk, a major Trump ally, is also a proponent of cryptocurrencies.

Eric Trump, one of the president-elect's sons and executive vice president of his private conglomerate, the Trump Organisation, is a keynote speaker at a bitcoin conference in Abu Dhabi next month, according to the event organizers.

"The incoming Trump administration may lead to expedited regulatory clarity, enhanced institutional participation, improved market infrastructure, and broader mainstream adoption," Deutsche Bank research analyst Marion Laboure said.

"Trump's pragmatic approach marks a clear departure from recent regulatory restrictions."

Flows into cryptocurrency exchange-traded funds have also picked up since Trump's election win. On Thursday, Nov. 7, bitcoin ETFs experienced their largest inflows on record, drawing a net $1.38 billion, according to data from Citigroup.

Gains in cryptocurrencies have been broad. Ether hit a more than three-month high above $3,350.70 and was last at $3,318.42, up 4.6 per cent. Dogecoin, an alternative cryptocurrency that began as a satirical critique of the 2013 crypto frenzy, was at a three-year high.

"Bitcoin is going much higher between now and the end of 2025," Anthony Pompliano, founder and chief executive officer at Professional Capital Management, said on Monday. "It is hard to find a compelling argument to be bearish or reserved right now."

Pompliano has been a major investor in the crypto space over the last several years.