(Bloomberg) — Bitcoin's rally fueled by U.S. President Donald Trump's election victory in early November is winding down as 2024 draws to a close.
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The digital asset was hovering around $94,000 as of 2:55 pm Tuesday in New York, about $14,000 below the all-time high set in mid-December. Smaller tokens like Ether and the meme-crowd favorite Dogecoin also struggled to gain traction.
Trump's preference for crypto-friendly regulations and support for the idea of a national Bitcoin fund raised digital assets. But reduced expectations for interest rate cuts from the Federal Reserve have cooled the speculative frenzy.
Greater clarity on the US crypto regime is likely to emerge after Trump takes power on January 20. The Republican stance contrasts with President Joe Biden's administration, which has tackled the a scandal prone sector.
Chris Weston, head of research at Pepperstone Group, said “the momentum has come out of the post-election move” in Bitcoin, partly due to outflows from exchange-traded funds for the token. The group of a dozen ETFs in the United States has seen a net outflow of nearly $1.8 billion since Dec. 19, according to data compiled by Bloomberg.
Meanwhile, software maker turning Bitcoin accumulator MicroStrategy Inc. has been on a buying spree in the past few weeks. Traders are waiting to see if the company – which owns more than $40 billion of the digital asset – will continue a pattern of announcing Bitcoin purchases on Mondays.
The original cryptocurrency has climbed around 120% this year, outperforming traditional investments such as global stocks and gold. Bitcoin also more than doubled in 2023 in a comeback from a deep bear market.
(Price of updates)
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