Bitcoin surged to an all-time high near $81,000, fueled by a wave of optimism following U.S. election results that saw pro-crypto candidates secure office. The bullish sentiment extended across the cryptocurrency market, with open interest in Bitcoin futures exceeding $90,000, reaching $2.8 billion on the Deribit derivatives exchange.
Derivatives Market Highlights Growing Momentum
According to Vetle Lunde, head of research at K33 Research, the options market is leaning toward continued upward momentum. Call options—bets that Bitcoin prices will rise—are trading at a premium to put options, reflecting bullish sentiment. Lunde noted that open interest in out-of-the-money calls has increased significantly.The Chicago Mercantile Exchange (CME) also reported a surge in Bitcoin and Ethereum futures premiums, which jumped from an average of 7% before the election to 14% after the results. "The recent surge is a meaningful deviation higher, emphasizing the bullish flows of late," said Lunde.
Liquidity Challenges and Weekend Volatility
Despite the rally, Lunde warned of typical weekend liquidity challenges in crypto markets, as CME futures and ETFs remain closed. This often leads to exaggerated moves that retrace when these markets reopen.
Trump’s Pro-Crypto Agenda Fuels Optimism
President-elect Donald Trump’s campaign promises have also ignited enthusiasm in the crypto space. Trump pledged to turn the U.S. into the "crypto capital of the planet," proposing a national crypto reserve with $16 billion in Bitcoin seized by the government. Additionally, his commitment to slashing interest rates could further bolster crypto prices by reducing borrowing costs.On Thursday, the Federal Reserve approved its second consecutive interest rate cut, aligning with Trump’s easing monetary policy stance. This move provided additional momentum, propelling Ether up 30% over the past week and pushing Solana’s market cap above $100 billion.
ETFs and Corporate Gains
Spot Bitcoin ETFs saw their collective market cap climb above $80 billion, with $2.3 billion added in just three trading days. Fintech companies tied to crypto outperformed, with Coinbase shares soaring 48% for the week. As one of the largest corporate donors in the election cycle, Coinbase contributed over $75 million to pro-crypto PACs.Trump’s promise to replace SEC Chair Gary Gensler has further buoyed the crypto industry. This development could favor companies like Coinbase, which is embroiled in legal battles with the regulator over alleged securities violations.
Robinhood and Broader Market Gains
Robinhood, another key player in the crypto space, saw its shares rise by 27% for the week. Despite receiving a Wells Notice from the SEC earlier this year, the brokerage remains optimistic, reflecting the market’s renewed confidence in a more crypto-friendly regulatory environment.
Looking Ahead
With the most pro-crypto Congress in U.S. history, fueled by institutional and retail enthusiasm, the crypto market is poised for significant growth. As Bitcoin leads the charge with record highs, other assets like Ethereum and Solana continue to gain traction, further solidifying the sector's position in global financial markets.
