For over a decade, many investors deliberately avoided cryptocurrencies. Some were unsure how to begin. Others witnessed the collapse of FTX two years ago and dismissed the entire sector as a scam. However, recent developments have made it increasingly difficult to ignore. With Donald Trump winning the U.S. presidential election and making pro-crypto promises, Bitcoin soared past the $100,000 mark, capturing global attention.
“I’ve been cautious about crypto my whole life,” said Ian Johnson, a 28-year-old from Sioux Falls, South Dakota, who recently purchased Bitcoin for the first time. “I just wanted to see what it would do. If Trump does well, I think it could go crazy.”
Johnson is among a growing wave of first-time investors entering the digital asset space. Bitcoin, the largest cryptocurrency, now boasts a market capitalization exceeding $2 trillion, rivaling some of the world’s biggest publicly traded companies. Other cryptocurrencies like Ethereum and Ripple have also seen significant surges.
This isn't Bitcoin's first attempt to enter the mainstream. The volatile price swings during the COVID-19 pandemic led to a series of high-profile crypto scandals, damaging its reputation. Yet, in recent years, digital assets have made a strong comeback. Increased institutional acceptance—particularly the launch of Bitcoin ETFs—has fueled the rally, and Trump’s election victory has added momentum to the boom.
A New Political Climate
Although the incoming president’s crypto policies are not yet fully defined, he has promised to establish a national Bitcoin reserve. He recently nominated crypto advocate Paul Atkins to chair the Securities and Exchange Commission, replacing the relatively hawkish Gary Gensler, who plans to step down on January 20. Trump’s close relationship with Elon Musk has also boosted optimism. Musk is known for influencing the prices of meme coins through his social media posts.
For Johnson, the election night hype was the final push. He was watching the results and texting a friend who had been urging him to invest in Bitcoin since 2012. His friend told him it would be foolish not to get in now. After seeing Trump win Pennsylvania—and having a few drinks—Johnson opened an account on Crypto.com and bought $1,000 worth of Bitcoin.
Since then, Bitcoin has risen approximately 50%, hitting a record high above $106,000 on Monday. Johnson says he plans to invest a few hundred dollars monthly into his account if prices continue to climb.
Hedge Against Uncertainty
Not all new investors are motivated by political enthusiasm. Mikko Rintala, a 50-year-old software engineer from Finland, also entered the market around the election. Rintala is not a Trump supporter but sees cryptocurrencies as a hedge against potential economic volatility triggered by the new administration. He has invested about $1,000 in a Binance account, split between Bitcoin and Ripple.
“I thought if Trump wins, nobody knows what will happen to the economy,” he said. “For me, crypto is like buying a lottery ticket.”
Mainstream Recognition
For others, cryptocurrency’s return to mainstream discourse prompted a reconsideration. Hank Martinez, a 43-year-old tech worker from California, spent years telling his family that crypto was a scam. Then, he kept hearing about it in the lead-up to the election.
“Trump started talking about a crypto czar, and I thought, ‘Okay, is this thing going legit?’” he recalled.
Martinez now laughs about his initial Google search: “Can you buy a piece of Bitcoin?” before opening an account on Crypto.com. He says his family struggles to understand his change of heart, but he finds it exhilarating to watch his investments grow.
According to Pew Research Center, about 17% of Americans have invested in cryptocurrencies, with men under 50 dominating the demographic. Bloomberg Intelligence data shows that U.S. cryptocurrency exchange-traded funds (ETFs), often used by retail investors, attracted a record $7.2 billion in November alone.
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Words of Caution
Despite the renewed crypto fever, financial advisors urge investors to proceed with a plan.
Given the asset’s “history of booms and busts,” Noah Damsky, principal at Marina Wealth Advisors, suggests that first-time buyers wait for a pullback from recent highs. He recommends that interested investors set a monthly purchasing plan and stick to it, regardless of price fluctuations.
Brittany Wolff, founder of Wolff Financial in South Carolina, advises buyers to carefully choose their exchanges and avoid concentrating too much of their portfolio in a single cryptocurrency.
“If someone is interested in investing in crypto for the first time, I’d encourage them to start small—say, 1% of their savings—with the understanding that prices can be highly volatile, so their investment could decline significantly,” she said.
Frequently Asked Questions
What caused Bitcoin to surge above $100,000?
Bitcoin’s recent price surge is largely driven by institutional adoption, the launch of Bitcoin ETFs, and pro-cryptocurrency policies anticipated under the new U.S. administration. Political endorsements and broader mainstream acceptance have also played significant roles.
Is it too late to invest in Bitcoin?
While Bitcoin has reached all-time highs, many analysts believe the market still has growth potential. However, investors should approach with caution, diversify their holdings, and avoid investing more than they are willing to lose.
How can I start investing in cryptocurrencies?
Beginners can open an account on a reputable exchange, such as Crypto.com or Binance. It’s advisable to start with a small amount, use dollar-cost averaging, and research different cryptocurrencies before investing.
What are the risks of investing in crypto?
Cryptocurrencies are highly volatile and susceptible to market speculation, regulatory changes, and technological risks. Investors should be prepared for significant price swings and only allocate funds they can afford to lose.
Can I buy a fraction of a Bitcoin?
Yes, Bitcoin is divisible, and investors can purchase fractions of a Bitcoin, making it accessible even with a small budget.
Will cryptocurrencies become mainstream investments?
With growing institutional interest and the introduction of regulated financial products like ETFs, cryptocurrencies are increasingly being viewed as a legitimate asset class, though they remain speculative and high-risk.