In an August 1, 2024, Barchart article on Bitcoin, I concluded:
While Bitcoin has a $1.3 trillion value, and all cryptos are worth around $2.4 trillion at current prices, the asset class remains small compared to stocks, bonds, commodities, and fiat currencies. The current size is a mixed blessing, as, on one hand, there is considerable room for growth. On the other hand, the higher the market cap rises, the greater the odds of governmental and legislative actions to protect control of the money supply. Therefore, expect the boom-and-bust price action to continue. The current upside target is the $100,000 level and a $3-4 trillion market cap. The company with the leading market cap is currently Apple, worth around $3.5 trillion. If Bitcoin or the asset class exceeds this level, expect government forces to slow the ascent with a coordinated effort to create another bust period.
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Bitcoin surpassed the upside target, and the crypto asset class market cap rose above the $3 trillion level. I did not appreciate that President Trump would embrace Bitcoin and cryptos and go on to sweep the swing states to become the 47th U.S. President in early August 2024. His election turbocharged Bitcoin, which could become a critical holding in the proposed U.S. wealth fund.
On July 31, 2024, Bitcoin traded at $66,428.87 per token. At its most recent high, the price exploded more than 64%.
An explosive rally- Bitcoin remains near the $100,000 level
Bitcoin surpassed the target of many of the cryptocurrency’s most ardent supporters in December 2024 when the leading crypto eclipsed the $100,000 per token level.
The monthly chart highlights Bitcoin’s rally, which took the price to a $109,012.48 high in January 2025. At over the $95,420 level in February, Bitcoin remains a bullish beast since the 2010 five-cent low. Incredibly, a $1.00 2010 investment is worth over $1.90 million.
The Trump administration is pro-crypto
President Trump has embraced cryptocurrencies, departing from the Biden administration. On January 23, 2025, the President signed an executive order including working toward developing a national digital asset stockpile. He appointed David Sachs, a venture capitalist, as the administration’s crypto and artificial intelligence czar.
The executive order stated, “The digital asset industry plays a crucial role in innovation and economic development in the United States, as well as our Nation’s international leadership.” The move came as no surprise as President Trump pledged, “If I am elected, it will be the policy of my administration, United States of America, to keep 100% of all the bitcoin the U.S. government currently holds or acquires into the future,” on the campaign trail.
Meanwhile, his nominee to head the Securities and Exchange Commission, Paul Atkins, has advocated for a decrease in the heavy-handed regulation under former SEC commissioner Gary Gensler. Moreover, Scott Bessent, the recently confirmed Treasury Secretary, had been a pro-crypto hedge fund manager.
A U.S. sovereign wealth fund could include Bitcoin and other cryptos
On February 3, 2025, another executive order called for creating a U.S. Sovereign Wealth Fund. The executive order stated:
Given the administration’s support of cryptocurrencies, a U.S. sovereign wealth fund could hold significant Bitcoin and other digital currency reserves.
The risk remains high- Jamie Dimon still thinks Bitcoin is a “pet rock”
Warren Buffett called cryptos “rat poison squared.” JP Morgan’s CEO Jamie Dimon recently said, “Bitcoin is a ‘pet rock’ that does nothing—except help with fraud and money laundering.” While the administration has put its arms around the bourgeoning asset class, lifting crypto prices and the asset class market cap above the $3 trillion level, the risk of a significant downside correction remains high.
The price history tells us that the higher the price rises, the greater the risk of a correction
Bitcoin’s price history has been a rollercoaster of pleasure and pain for those who dipped their toes in the digital currency over the past decade and a half.
Over the past seven years, the monthly chart highlights that new highs have often led to significant corrections.
The chart shows the 55.3% correction from the April 20201 $64,789.27 high to the June 2021 $28,957.79 low. After reaching $68,906.48 in November 2021, Bitcoin fell 77.5% to a $15,516.53 low in November 2022. After rallying to a higher $73,662.76 high in March 2024, the leading crypto dropped 32.4% to a $49,784.02 low in August 2024 before taking off to the most recent peak.
Bitcoin and cryptocurrencies are not for the faint of heart. The potential for oversized rewards comes with commensurate risks. While the Trump administration has shown significant support for the asset class, market forces could create the conditions for another significant percentage correction in the blink of an eye. The bullish trend since the 2010 low continues, but the odds favor a continuation of a wild ride in the leading digital currency.
