Bitcoin (BTC-USD) hit a record high, surpassing $100,000 (£78,692) for the first time, late on Wednesday night. The cryptocurrency peaked at $103,000 before settling at $102,900 as of the time of writing, according to CoinGecko data.
This marks a 6% on Thursday, an almost 50% rise over the last month and a 67% jump since early October, when bitcoin was trading around $60,000.
A surge in retail investor demand has played a key role in driving bitcoin’s price above $100,000. Retail demand over the past 30 days has reached its highest levels since 2020, according to a report by CryptoQuant.
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While long-term holders are beginning to take profits, increased retail participation could sustain short-term momentum, CryptoQuant analysts said. However, they cautioned that heightened retail activity often coincides with local market tops, making it critical to monitor the balance between retail and institutional flows.
While the rally has sparked excitement, some analysts warned of potential risks down the line. Historical cycles show that rapid increases in asset prices are often followed by sharp corrections.
“Breaking above the $100,000 resistance puts bitcoin in price discovery mode, an uncharted territory that could fuel even greater market excitement. However, with the Fear and Greed Index now above 80, signalling extreme greed, investors should remain cautious about the potential for increased volatility and profit-taking,” BRN analyst Valentin Fournier said.
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Fournier added that institutional inflows into bitcoin and ethereum (ETH-USD) spot exchange-traded funds (ETFs) remain robust, with $557m and $168m respectively in recent weeks, underscoring sustained interest from larger players.
Institutional adoption continues to be a driving force in bitcoin’s rally. MicroStrategy (MSTR), the largest publicly traded corporate holder of bitcoin, announced the purchase of an additional 15,400 bitcoin in November for $1.5bn. This brings its total holdings to 402,100 bitcoin, valued at over $40bn at current prices.
The US spot bitcoin ETF market has also contributed to the rally. Glassnode data shows that November set a record for ETF inflows, with $6.1bn added during the month. BlackRock’s (BLK) iShares Bitcoin Trust (IBIT) accounted for $5.4bn of total inflows, signalling strong investor appetite for regulated bitcoin exposure.
The rally has unfolded against a backdrop of rising inflation concerns and speculation about clearer cryptocurrency regulations ahead of Donald Trump’s inauguration as US president on 20 January.
