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Cryptocurrency

Bitcoin Hits $100,000 but Pulls Back to Below Milestone

2024-12-05

Bitcoin, the digital currency that has captured the imagination of investors worldwide, achieved a remarkable milestone on Wednesday evening. It soared past the long-awaited $100,000 benchmark for the first time ever. This significant event sent shockwaves through the financial markets and sparked intense discussions among experts and enthusiasts alike.

Bitcoin's Historic Ascent and Future Prospects

Bitcoin's Initial Surge and Subsequent Pullback

By Thursday afternoon, the flagship cryptocurrency pulled back from the $100,000 milestone. It was recently higher by 0.28% at $99,140.00, according to Coin Metrics. This pullback followed some profit taking by investors, as they took advantage of the significant gains. On Wednesday night, it rose as high as $103,844.05, demonstrating the volatility and potential of this digital asset.The move came after President-elect Donald Trump announced plans to nominate Paul Atkins as chair of the Securities and Exchange Commission. This appointment could fulfill Trump's most important campaign promise to the crypto industry. Gary Gensler, who has been a controversial figure in the crypto space under his leadership, may be replaced. Trump congratulated bitcoiners in a Truth Social post Thursday morning, saying "you're welcome" for his part in helping send bitcoin to $100,000 and that "together, we will make America great again."

The Anti-Establishment Roots of Bitcoin

It's a day of celebration for longtime bitcoin investors who have held on through several boom-and-bust cycles. The original idea for bitcoin was proposed at the height of the 2008 financial crisis. Satoshi Nakamoto wrote in the Bitcoin Whitepaper that a "peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution." This anti-establishment nature has been a key factor in the popularity and growth of bitcoin.In recent years, the industry has demonstrated the value of bitcoin to much of the institutional investing world. BlackRock, Fidelity, Invesco, and others launched the first spot bitcoin ETFs at the beginning of this year. This "IPO" moment has helped drive the price higher, as institutions have shown growing demand for bitcoin. In November, Rick Wurster, the incoming CEO of Charles Schwab, said the firm is preparing to enter spot crypto trading, pending regulatory changes expected in the next Trump administration.

The Federal Reserve's View on Bitcoin

On Wednesday, Federal Reserve Chair Jerome Powell said bitcoin is "just like gold, only it's virtual, it's digital." He further clarified that "people are not using it as a form of payment, or as a store of value" and that "it's not a competitor for the dollar, it's really a competitor for gold." This statement highlights the unique position of bitcoin in the financial landscape and the challenges it faces in gaining mainstream acceptance."We're witnessing a paradigm shift. After four years of political purgatory, bitcoin and the entire digital asset ecosystem are on the brink of entering the financial mainstream," Mike Novogratz, CEO of Galaxy Digital, told CNBC. This shift is driven by various factors, including the actions of government and financial institutions and the growing demand from institutional investors.

Expected Pro-Crypto Initiatives

Bitcoin had been widely expected to reach the landmark $100,000 level since the U.S. presidential election. Excited investors sent bitcoin closer to this mark much sooner than initially anticipated; it rose as high as $99,849.99 on Nov. 22. There is much hope that Trump will deliver on several pro-crypto initiatives in the year ahead, including the establishment of a national strategic bitcoin reserve or stockpile, no taxes on crypto transactions, and opening up the crypto public equity markets with more IPOs."Over the long term, I'm bullish," Novogratz added. "It won't be a straight line up, and investors should always consider taking gains off the table. But, with a pro-crypto administration about to take charge in the U.S., it'll be hard for the rest of the world not to take notice."Bitcoin is now up more than 133% in 2024 and 42% since the election. This remarkable performance has attracted the attention of investors from all over the world and has solidified bitcoin's position as a major player in the financial markets.

Haliey Welch, a 22-year-old, made waves this summer with her viral “hawk tuah” TikTok video. This led to her taking a rather bizarre career turn by launching her own memecoin on the Solana blockchain. However, the value of this coin plummeted almost immediately, causing quite a stir in the cryptocurrency world.

The Tale of Haliey Welch's Memecoin Launch and Its Swift Downfall

Initial Fame and Merchandise

Over the summer, a man-on-the-street interviewer filmed Haliey Welch for a TikTok video. When asked about what makes a man go crazy in bed, she responded with “you gotta give him that ‘hawk tuah.’” This simple video took off in June, and Welch quickly capitalized on her newfound fame by releasing merchandise. She started to build a popular social media presence, joining Instagram in July and posting pictures with celebrities like Matt Rife and JoJo Siwa. She even had the opportunity to join country star Zach Bryan onstage at a June concert and throw out the first pitch at a New York Mets game in August.This rapid rise in popularity led to the launch of her podcast, “Talk Tuah,” in September. It quickly gained popularity and at one point ranked as the fifth most-popular podcast on Spotify’s daily charts, behind only Joe Rogan’s show. The podcast is owned by boxer and social media personality Jake Paul’s company Betr, and she has hosted guests such as Wiz Khalifa, Mark Cuban, and Brooke Schofield.

The Memecoin Launch and Its Immediate Plunge

On Wednesday evening, Welch launched the Hawk Tuah coin, which is widely regarded as a memecoin or a form of cryptocurrency created for entertainment purposes. It quickly hit a market capitalization of nearly $500 million. But just as quickly, it plummeted 95% to $25 million by Thursday afternoon, according to DexScreener data. As of Thursday afternoon after 4 p.m. EST, the coin’s price was $0.002439, down from a high of $0.04916 on Wednesday evening.The chaotic launch seemed to result in significant losses for some traders. Crypto YouTuber Coffeezilla, with over 3 million subscribers and whose real name is Stephen Findeisen, had a tense X space conversation with Welch and her team. He accused them of insider trading, which they denied. CoinTelegraph reported that about 80 to 90% of the Hawk Tuah supply was controlled by insiders or snipers—entities that purchase large amounts of a coin’s supply at its launch. Welch, in a post on X, said her team had not sold any tokens and had tried to stop snipers as best they could.

Legal Implications and Speculations

After the Hawk Tuah coin sparked backlash on social media, Burwick Law, a firm specializing in cryptocurrency, posted on X urging people who lost money on the memecoin to reach out to “learn about your legal rights.” However, it’s unclear whether the crash will have legal consequences, and there is no clear evidence of wrongdoing or illegality. Some critics have speculated—without proof—that Welch’s coin was launched as part of a “pump and dump” scheme, where the value of an asset, including a cryptocurrency, is quickly inflated and then sold off, causing the value to crash. The CFTC first cracked down on crypto pump and dumps in March 2021, charging two individuals on multiple counts of fraud for deceiving crypto investors and profiting more than $2 million in one such scheme.

Instagram Followers and Further Readings

Haliey Welch has an impressive 2.6 million Instagram followers, which clearly shows her rapid rise to internet fame. For those interested in learning more about the Hawk Tuah memecoin and its story, there are several further readings available. CoinTelegraph has an article titled “Hawk Tuah memecoin dumps 90% amid backlash over controversial launch,” Forbes has an article titled “The ‘Hawk Tuah’ Creator’s Podcast Ranks No. 5 On Spotify—Here’s How She Kept The Meme Going For Months,” and another Forbes article titled “‘Hawk Tuah’ Meme Explained: How Woman In Viral Interview Made A Reported $65,000 And Prompted TikTok Craze.”

If you had the foresight to purchase a bitcoin within the past decade and held onto it, kudos to you! You've reaped significant profits. Over the past eight years, the value of a single bitcoin has soared from $453 to an astonishing over $100,000. This remarkable record-breaking high followed President-elect Donald Trump's announcement of nominating Paul Atkins as the next head of the Securities and Exchange Commission. Atkins is widely regarded as more pro-cryptocurrency than his predecessors. Andrew O'Neill, a digital assets expert at S&P Global, shared with the BBC that there is an expectation that the new administration will be more favorable to crypto compared to the old one.

Understanding Cryptocurrency's Rocky History

The cryptocurrency market is notoriously volatile. During the early days of the COVID-19 pandemic, bitcoin witnessed a swift decline from $10,000 to $4,000 per coin within just 48 hours. Despite these fluctuations, some investors have managed to make substantial profits from their crypto investments and are now eyeing real estate. Interestingly, sellers across the country are increasingly accepting bitcoin. As Johnny Schiro, senior vice president of business development at RealOpen, told Realtor.com®, Miami stands out as the U.S. crypto hub. New York, Los Angeles, the San Francisco Bay Area, Las Vegas, and Colorado also witness significant crypto real estate activities.

Using Bitcoin to Buy a Home

RealOpen is one of the agencies that enables buyers to use bitcoin for purchasing real estate. Instead of directly dealing with sellers willing to accept bitcoin, RealOpen converts your cryptocurrency into cash for the seller while charging a fee. There are also companies like Milo that offer crypto-backed mortgages. This allows cryptocurrency holders to use their virtual money as collateral when taking out a mortgage. Buyers can secure up to $5 million against their bitcoin, ethereum, or USDC currency. Of course, the most straightforward way to buy a home with crypto is to convert it into cash. However, one must consider the tax implications. In many cases, a capital gains tax is applicable on any earnings made in the market, and these taxes can quickly add up.

Finding Homes Accepting Bitcoin

Currently, there are several properties available for purchase using bitcoin or two. For instance, there is a two-bedroom home in Sebring, FL, listed at $99,000. Additionally, a mobile home in Sebring, FL, is priced at $139,900 and can be purchased using bitcoin or ethereum along with cash. In Laytonville, CA, a 45-acre truffle farm is on the market for $215,000, and the seller accepts cryptocurrency. There is also a two-bedroom home in Brooksville, FL, listed at $135,000. Furthermore, a three-bedroom home in Myrtle Beach, SC, is priced at $242,000 and accepts bitcoin and ethereum. These properties offer unique opportunities for crypto investors to convert their digital assets into physical real estate.