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Bitcoin, Dogecoin: Crypto prices rise amid investor excitement over Trump

The price of Bitcoin and other cryptocurrencies surged on Monday, continuing the rally sparked last week by former President Donald Trump’s re-election.

Bitcoin’s value rose 6.5% in early trading on Monday, hitting a record high as it surpassed $84,000 for the first time ever. Ether, the second-largest cryptocurrency by market cap, rose more than 3%.

The euphoria also inspired lesser-known coins. The price of Litecoin rose by more than 4%, while the price of Dogecoin rose by 21%.

“They were on a roll together,” Katie Stockton, founder of market research firm Fairlead Strategies, told ABC News. “Similar to Bitcoin, we have seen breakouts in the cryptocurrency markets.”

The boom in digital assets appears to reflect investor enthusiasm over Trump, who has vowed to strengthen the cryptocurrency sector and ease regulations enforced by the Biden administration, experts told ABC News.

In July, Trump told the audience at a cryptocurrency conference in Nashville, Tennessee that he wanted to make the US the “crypto capital of the planet.”

Trump promised to weaken federal oversight of cryptocurrencies and create the federal government’s first national strategic Bitcoin reserve.

Trump also said he would replace Securities and Exchange Commission Chairman Gary Gensler, whom many crypto advocates dislike because of his robust approach to crypto regulation.

“Crypto has changed a lot since the election, and for me that’s because of the news of a changing regulatory environment,” Bryan Routledge, a professor of finance at Carnegie Mellon University’s Tepper School of Business, told ABC News.

The rise in cryptocurrency prices on Monday far outpaced the performance of the US stock market. In early trade the SThe &P 500 rose 0.25%, while the Dow Jones Industrial Average gained 0.75%, or about 330 points. The tech-heavy Nasdaq gained just 0.1% in early trading on Monday.

The sharp rise in Bitcoin prices marked a breakthrough for the world’s largest cryptocurrency. However, the recent rise follows a period of stellar returns dating back to last year. The price of Bitcoin has increased by 122% since November 2023.

Former President Donald Trump speaks at the Bitcoin 2024 conference in Nashville on July 27, 2024.

Brett Carlsen/Bloomberg via Getty Images

Those gains were driven in part by the U.S. approval of Bitcoin ETFs, or exchange-traded funds, in January. Bitcoin ETFs allow investors to buy into an asset that tracks Bitcoin’s price movement while avoiding the inconvenience and risks of purchasing the crypto coin itself.

“If you look at how the price of Bitcoin has changed a lot over the last year, the increase in the last week is somewhat impressive, but the increase in the last year was five times as impressive,” Routledge said.

The crypto industry entered this year after a series of high-profile collapses and corporate scandals.

FTX, a multi-billion dollar cryptocurrency exchange co-founded by Sam Bankman-Fried, collapsed in November 2022. The implosion sparked a 17-month legal saga that led to Bankman-Fried’s conviction on fraud charges. In April, Bankman-Fried was sentenced to 25 years in prison.

Changpeng Zhao, the founder and former CEO of major cryptocurrency exchange Binance, was sentenced to four months in prison in April after pleading guilty to charges that his platform facilitated illegal financial activities.

The cryptocurrency’s sustained recovery in recent years has proven remarkable, but it also comes amid the volatility that has characterized digital assets since Bitcoin’s inception in 2009, said David Yermack, a professor of finance at New York’s Stern School of Business York University, told ABC News.

“It can fall and rise very, very quickly,” Yermack said. “It’s extraordinarily volatile.”

According to experts, the cryptocurrency is likely to remain highly volatile even if Trump loosens regulations.

Because cryptocurrencies have not gained widespread acceptance as a means of facilitating exchange, the asset serves primarily as a store of value, similar to gold, Routledge said. Such assets sometimes show strong appreciation due to a favorable economic environment, but also carry significant risks, Routledge said.

“We don’t use cryptocurrency to buy coffee,” Routledge said. “It serves as digital gold. Such assets tend to be quite volatile.”

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