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Bitcoin hit a record $120,000 on Monday as US lawmakers prepared to vote this week on legislation aimed at making America the world’s “crypto capital”.
The world’s largest cryptocurrency climbed 2.8 per cent to as high as $122,404, taking its gain to over 10 per cent in the past week and extending a blistering rally since Donald Trump’s election victory.
Over the next week, lawmakers in the Republican-controlled House will debate the Genius Act, the Digital Asset Market Clarity Act, and the Anti-CBDC Surveillance State Act.
While the legislation spans everything from companies’ issuance of stablecoins to the regulation of the sector, investors said that the passage of the bills would help push cryptocurrencies further into the mainstream of finance.
“For capital allocators, what’s most attractive is having some semblance of clarity,” said Tim Chen, global head of strategy at financial services firm Mantle.
Bitcoin’s renaissance comes less than three years after the collapse of crypto exchange FTX sent the price of the digital currency plummeting to $16,000 and cast doubt over its future.
But Trump’s return to the White House has galvanised the sector, with the president promising to turn the US into the “bitcoin superpower of the world” and installing cryptocurrency advocates to several key jobs.
At the start of what he dubbed “crypto week”, French Hill, chair of the House Committee on Financial Services, said: “We are advancing landmark legislation to establish a clear regulatory framework for digital assets.”
The US Senate has already approved the Genius Act, a bill that enables private companies to issue stablecoins, a type of cryptocurrency that is pegged to an asset such as the US dollar.
The Clarity Act would establish a regulatory framework for digital assets that will “establish clear lines” between the Securities and Exchange Commission and the Commodity Futures Trading Commission for regulating digital assets.
The Anti-CBDC Surveillance State Act would prohibit the Federal Reserve from issuing a central bank digital currency.
Bitcoin’s rally has also been turbocharged as a growing array of companies buy the cryptocurrency as an investment and to help their share prices.
“This move higher likely has legs, as public companies with bitcoin on their balance sheets and fresh capital raises will need to keep buying to maintain their treasury exposure,” said Darius Sit, founder of digital asset market maker QCP.
Greater regulatory clarity will only increase the trend and “usher in a wave of capital and founders”, said Mantle’s Chen. “It means the US is open for business.”
Le Shi, head of trading at Auros, a digital-focused market-making firm, said the passage this month of Trump’s “big beautiful bill” becoming law had also contributed to the rally.
“The passage has been interpreted by many market participants as a green light to buy everything. You see that across multiple asset classes,” he said.