Bitcoin surges past $94K amid growing optimism – Is $100K within reach?

Inching closer to the $100,000 mark, Bitcoin (BTC) hit a new milestone on Tuesday as it surged 4% higher to trade above the $94,000 mark, thus breaking the previous record of $93,450, which was set on November 13, 2024.

The rally was fuelled by reports that U.S. president-elect Donald Trump's social media company, Trump Media and Technology Group, was in talks to acquire crypto trading firm Bakkt, sparking optimism about a more "crypto-friendly environment" under the upcoming Trump administration. BTC has gained about 25.7% since the U.S. elections on November 5, 2024.

The introduction of options trading for BlackRock’s iShares Bitcoin Trust (IBIT) is another milestone that will potentially boost liquidity and provide investors with more ways to gain exposure to the asset.

"This development represents a crucial turning point in Bitcoin's evolution, highlighting the growing institutional interest and a shift in market dynamics. For crypto traders and investors, Bitcoin’s recent surge marks the start of a larger movement towards mainstream adoption, with its future price potential looking more promising than ever," says Sumit Gupta, co-founder, CoinDCX.

Wall Street’s introduction of "options trading" on spot Bitcoin ETFs is expected to boost institutional adoption. However, BTC has since retraced, trading below $92,000 as the market takes a breather.

According to the latest data on CoinDesk, the world's largest cryptocurrency by m-cap is trading at $92,296.37 (10.00 IST), up 0.72%, taking its m-cap to $1.83 trillion. However, other cryptocurrencies like Ethereum, Solana, and DOGE, among others, are all trading in negative.

BlackRock's Option saw a record $1.9 billion in trading volume on its first day, fuelling Bitcoin's price rally, says Edul Patel, co-founder and CEO of Mudrex. "Profit-taking following the peak has pulled BTC back to its current level of $92,000." The escalating Ukraine-Russia tensions have also put investors in a cautious mode, says Patel. "Bitcoin now faces resistance at $94,600, with support holding steady at $90,400."

According to CoinSwitch markets desk, American technology company MicroStrategy executive chairman and co-founder Michael Saylor has also revealed plans to pitch Microsoft on adding Bitcoin to its treasury, arguing it would enhance the company’s stability and reduce risk. In the altcoin market, a brief meme-coin rally was overshadowed by corrections following BTC’s pullback from its peak.

Can BTC hit $100K?

NASDAQ's listing of options on BlackRock’s BTC spot ETF marks a "significant milestone" for the Bitcoin derivatives market, as derivatives for traditional assets often grow to be 10-20 times the size of the underlying market cap.

Traders at Singapore-based QCP Capital say this development is poised to attract a new wave of institutional investors who face restrictions on accessing native crypto options markets like Deribit. "These investors are likely to focus on generating yield on their long-term spot ETF holdings, potentially leading to further compression of implied volatility."

Meanwhile, Goldman Sachs is also planning to spin off its digital asset platform, further highlighting the growing integration of crypto into traditional finance. "The December 100k strike continues to hold the highest concentration of open interest. With spot finding its footing above 90k — evidenced by implied vol flies dropping 1 point from last week — we believe this could provide the foundation BTC needs for a move higher."