Bitcoin hits new record high as Trump administration signals support for the cryptocurrency

The digital currency has been hitting record highs and neared $100,000 this past week, having doubled in value throughout 2024.

Bitcoin price nears $100,000 amid Trump's crypto push, sparking record highs

If it seems everyone is talking about bitcoin these days, you're onto something.

The digital currency has been hitting record highs and neared $100,000 this past week, having doubled in value throughout 2024. Launched in 2009, bitcoin is the first cryptocurrency, meaning that it's a digital currency and does not rely on banks to verify transactions.

Bitcoin's surge – up about 130% this year – is one of the "Trump trades," market moves that have kicked in since former President Donald Trump's victory in the Nov. 5 election.

Trump has dabbled in cryptocurrency – releasing crypto-based digital trading cards – and Trump Media and Technology Group, which operates Truth Social, is reportedly close to acquiring crypto trading firm Bakkt. The Trump family launched its own crypto firm, World Liberty Financial, in September.

Investors have wagered Trump's support for bitcoin and other digital assets will lead to fewer restrictions on the industry. During the presidential campaign, Trump said he would make America the “world capital for crypto and bitcoin.”

Trump has tapped Tesla CEO and SpaceX founder Elon Musk to co-lead, with Vivek Ramaswamy, the new Department of Government Efficiency, or D.O.G.E. It's an acronym for cryptocurrency called Dogecoin, which Musk supported as it became a phenomenon in 2021. 

Been hit with the bitcoin buzz, but don't quite understand it? Here's some bitcoin basics.

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What is bitcoin?

Bitcoin is a digital asset, launched in 2009 by a person or group known as Satoshi Nakamoto and designed to have a cap of 21 million bitcoin tokens. Bitcoin is created as crypto miners use their computing work to validate bitcoin transactions on its decentralized blockchain network, essentially a digital ledger meant to prevent fraud. As the crypto miners work, they earn bitcoin.

So far, about 19 million tokens have been released. In April, bitcoin underwent a "halving," which kicks in about every four years to reduce the rate at which new bitcoins are created and released into circulation. As the bitcoin cap of 21 million tokens nears, demand likely increases, according to Investopedia.

Currently, a bitcoin is worth about $98,000. But the ownership of fractional shares of bitcoin is common, notes NerdWallet.

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What are bitcoin ETFs?

It's Trump's interest in bitcoin alone that's led to bitcoin's climb. Earlier this year, the U.S. Securities and Exchange Commission voted to allow the sale of bitcoin-based exchange-traded funds, or ETFs, to the public.

That action allowed more investors to get into bitcoin in a similar manner to how they invest in stocks, bypassing crypto exchanges.

How does bitcoin work?

Like the dollar, bitcoin can be used as currency, but it's virtual and isn't controlled by banks or governments. While an entire bitcoin is priced at nearly $100,000, you can own partial shares of each coin. The smallest share of each bitcoin is called a Satoshi – after the cryptocurrency's creator – equal to a hundred millionth of one bitcoin, according to NerdWallet.

You can buy bitcoin on a crypto exchange such as Binance.US, online stockbrokers including Fidelity and E-Trade, and trading apps like Robinhood.

If you buy bitcoin on a crypto exchange, you will create a "crypto wallet" to hold your bitcoin. If you invest in those bitcoin ETFs the SEC approved earlier this year, online brokers will hold your bitcoin in your brokerage account as any other investment.

What can I buy with bitcoin?

Pretty much anything. For instance, you can get a bitcoin debit card, which you load with a certain amount of your cryptocurrency holdings. That can be used as you would any debit card.

Beyond that, many companies now accept cryptocurrency for purchases including AT&T, Microsoft, Rolex, Time Inc., and Tesla, notes Investopedia.

You can buy "art," too. That banana duct-taped to a wall, which sold last week for $6.2 million? The buyer paid in crypto.

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What concerns are there about bitcoin and cryptocurrencies?

Back in 2018, investment guru Warren Buffett predicted that cryptocurrencies such as bitcoin, will likely "come to a bad ending." His stance hasn't really changed, reported Nasdaq.com.

But many point to the surge in bitcoin's valuation as a sign the cryptocurrency has arrived. Anthony