Good morning investors. While Wall Street used to dismiss bitcoin like a cute sideshow, nothing is capturing more attention than the cryptocurrency right now.

Bitcoin bulls can thank Donald Trump for sending it to the moon.

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Higher and higher and…

With Trump winning the White House, bitcoin investors seem to be accelerating down a long road of green lights and few obstructions. 

The world’s largest cryptocurrency soared above $89,200 Monday evening — good for a roughly 30% rise since the day before the election and a 101% jump in 2024. 

Eric Balchunas, senior ETF analyst for Bloomberg Intelligence, said that the market over the last week is responding to what’s expected to be a lack of antagonistic regulators in the years ahead. 

“The Trump victory was directly connected to the surge,” Balchunas told me. 

The pro-crypto administration comes into power alongside a bitcoin-friendly Congress as well as what is almost certain to be new SEC leadership, minimizing the likelihood for snags related to red tape.

During his campaign, Trump said he wanted to make the US the “crypto capital of the planet” and he floated the idea of a strategic bitcoin stockpile. 

Meanwhile, huge amounts of retail and institutional capital have flooded spot bitcoin ETFs over the last week.

Plus, crypto-linked stocks MicroStrategy and CoinBase each gained 25% and 19.7% on Monday, respectively. 

“The big variable is FOMO,” Balchunas said, adding that if he were a trader he’d be “hesitant” to bet against bitcoin right now.

Digital asset funds have seen $1.98 billion of inflows post-election, with the week up to November 11 marking the fifth positive week in a row, according to CoinShares data.

Bitcoin ETFs accounted for more than 90% of those inflows.

Bitcoin is now the eighth largest asset in the world, with a bigger market capitalization than all but six public companies.

Steve Sosnick, chief strategist for Interactive Brokers, cautioned Monday that the euphoria around the Trump Trade has led to traders being sucked into a vertical rally.  

“It is important to remember that parabolic moves have a way of unwinding unpredictably,” Sosnick said.

In any case, during Trump’s first administration, he regularly pointed to the strong stock market as an indicator of his performance as president.

That in mind, chances are Trump will do whatever he can to make the stock market go up — offering one more tailwind to bitcoin, given that the crypto is highly correlated with equities. 

To that point, analysts currently project the highest forward 12-month P/E ratio for theS&P 500 in more than three years, according to FactSet.

“Stocks declining are one of the Achilles heels of bitcoin, but we’re about to have a president who will bend over backwards to make sure stocks look good,” Balchunas said.

He noted that while he doesn’t share price forecasts, the odds of bitcoin hitting $100,000 now look far more likely now compared to a week ago.  

“With the new administration and favorable regulatory environment, not to mention stocks doing so well and ETFs are just getting started, it’s just hard to see bitcoin not getting there,” he said. “Those are famous last words though.”

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Elsewhere:

💰️Elon Musk is $70 billion richer since Trump’s win. Tesla stock has surged 39% over the last week, and it’s sent its CEO’s net worth soaring. Musk spent at least $130 million on the campaign trail for Trump. His net worth has swelled to $320 billion, about $90 billion ahead of Oracle founder Larry Ellison, the world’s second-richest person. (CNBC)

📈 S&P…10,000? Yardeni Research president Ed Yardeni told clients he expects the S&P 500 to hit 6,100 by the end of 2024 and then 10,000 by the end of the decade. That’s higher than a recent estimate from the strategist of 8,000. (Yahoo Finance)

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