Bitcoin hits $80,000 for the first time as crypto traders bask in Trump election victory
Budrul Chukrut | SOPA Images | Lightrocket | Getty Images
Cryptocurrencies extended their rally on Sunday, with bitcoin touching $80,000 for the first time ever.
The price of the flagship cryptocurrency was last higher by 4.5% at $79,800.19, according to Coin Metrics. Ether rose 3%, after passing the $3,000 level on Saturday. It last changed hands at $3,203.10.
Smaller coins saw bigger moves as investors continued to digest the implications of a second term for President-elect Donald Trump. The payments coin XRP surged 11%. The decentralized finance token tied to Cardano rocketed 40%. Memecoins dogecoin and Shiba Inu coin soared 17% and 31%, respectively.
“Crypto is poised to enter a golden era,” Alex Thorn, head of research at Galaxy Digital, said in a research note Friday. “Trump has promised to make America the ‘crypto capital of the world’ and his high level team is filled with strong crypto advocates … . The pro-crypto nature of his team, family, and donors increases the likelihood that Trump follows through on his campaign promises to the industry.”
Bitcoin touches $80,000 on Sunday for the first time ever.
Bitcoin was deemed a safe asset regardless of the outcome of the election — it is not considered a security, even by the Securities and Exchange Commission, and Trump has made big overtures about bitcoin like entertaining the idea of a strategic national bitcoin reserve and speaking about the need to keep all bitcoin mined in America.
Ether and other cryptocurrencies, however, stand to gain much more from the crypto-friendly regulatory environment that Trump has promised and appears to be a priority for many in his inner circle. For example, one reason the spot bitcoin ETFs didn’t see as much success as bitcoin ETFs is because they don’t distribute staking rewards. Many in the industry are hopeful that will change next year.
“In this environment, over the next two years we expect that bitcoin and other digital assets will trade significantly higher than the current all-time high,” Thorn said. “What was once an oppressive headwind in the world’s largest capital market will now shift to a tailwind, and no one is bullish enough.”
Bitcoin and ether have gained 18% and 32%, respectively, since election day. Coinbase rose 48% last week, its best week since January 2023.
Representations of cryptocurrency Bitcoin are seen in this illustration taken November 25, 2024.
Dado Ruvic | Reuters
Cryptocurrencies rose to start the year, rebounding from recent losses as investor optimism returned to the market.
The price of bitcoin rose 2% to $96,711.71 Thursday, bringing its new year gain to about 3% when counting trading from the Jan. 1 session.
The CoinDesk 20 index, a measure of the broader cryptocurrency market, advanced 4%. The token tied to Solana, the popular Ethereum competitor, led the gains with a 7% increase. Crypto stocks Coinbase and MicroStrategy each climbed 4% as well.
Bitcoin rebounds to start the year
This year is expected to be a banner year for the crypto industry thanks to a more favorable regulatory environment promised by President-elect Donald Trump. Investors are hoping Congress will pass its first ever crypto focused legislation – which could be centered around stablecoins or market structure.
Traders are also keen to see the crypto public equity markets open up with more initial public offerings and progress on a potential national strategic bitcoin reserve.
Crypto assets slid into the end of 2024. Although the post-election rally that sent bitcoin to new records above $100,000 had fizzled, the flagship cryptocurrency still ended the year up more than 120%. Long-term holders took some profits while others sold amid renewed uncertainty about the direction of Federal Reserve interest rate cuts in 2025.
Tesla CEO and X owner Elon Musk speaks during an unveiling event for Tesla products in Los Angeles on Oct. 10, 2024.
Tesla | Via Reuters
Tesla posted its fourth-quarter vehicle production and deliveries report on Thursday. Here are the key numbers:
Total deliveries Q4 2024: 495,570
Total production Q4 2024: 459,445
Total annual deliveries 2024: 1,789,226
Total annual production 2024: 1,773,443
Results for the quarter represented the first annual drop in delivery numbers for Tesla, which reported 1.81 million deliveries in 2023. It reported 484,507 deliveries in the fourth quarter of 2023.
Tesla shares fell by as much as 7% in trading on Thursday.
Analysts had expected Tesla to report deliveries in the quarter of 504,770, including 474,000 Model 3 and Model Y EVs, according to a consensus of estimates compiled by StreetAccount. Tesla sent some investors a company-compiled delivery consensus of 506,763 vehicles, based on a survey of 26 analysts. A widely followed independent Tesla researcher, who publishes as Troy Teslike, predicted deliveries of 501,000.
Deliveries are the closest approximation of sales reported by Tesla but are not precisely defined in the company’s shareholder communications.
The fourth-quarter report comes after a huge late-year rally in Tesla’s stock, which finished 2024 up 63%. In mid-December, the shares reached a record, eclipsing their prior all-time high from 2021.
It was a big turnaround from the first quarter, when the stock plummeted 29%, its worst period since 2022, as the company contended with declining sales despite price cuts and incentives for buyers. On the company’s first-quarter earnings call in April, CEO Elon Musk told investors that while he expected “higher sales this year than last year,” the growth rate would slow from 38% in 2023.
The biggest story at Tesla in the back half of the year was Musk’s role in President-elect Donald Trump’s election campaign. Musk, the world’s richest person, poured in around $277 million to promote Trump and other Republican candidates, and spent weeks on the road campaigning in swing states.
Elon Musk speaks with U.S. President-elect Donald Trump at a viewing of the launch of the sixth test flight of the SpaceX Starship rocket, in Brownsville, Texas, U.S., November 19, 2024.
Brandon Bell | Via Reuters
Musk, who also runs SpaceX and xAI and owns social network X, has been tapped to co-lead an advisory group to the Trump administration that will aim to slash federal spending, personnel and regulations.
Sam Fiorani, a vice president at industry research group Auto Forecast Solutions, told CNBC in an email that Musk’s foray into politics may have “pulled his focus away from his core businesses.” However, the degree to which investors or EV buyers care won’t be reflected in Tesla’s numbers until the first quarter, he said.
Until recently, Tesla had been one of the only automakers mass producing battery-electric vehicles. The company now faces an onslaught of competition from domestic automakers, including General Motors, Ford and Rivian as well as BYD in China, Hyundai in Korea, and European auto giants BMW and Volkswagen.
Patrick George, editor in chief of InsideEVs, told CNBC that he thinks Tesla still does many things better than any other EV maker, especially when it comes to its charging network. But Tesla’s biggest operational challenge in the latest quarter was “the nuts-and-bolts job of being a car company.”
‘Piling up on used car lots’
Tesla has invested in a humanoid robotics initiative and chip development, and plans to produce a dedicated robotaxi and start a driverless ride-hailing service before 2027. While Musk and shareholders may not want to view Tesla as just a car company, most of the profits are still derived from vehicle sales.
George said that Tesla made a mistake not bringing “more affordable EVs in 2024,” and added that Cybertrucks — the company’s newest vehicle — are “piling up on used car lots.” The angular steel Cybertruck starts at around $80,000.
With competitors picking up market share in Europe, Tesla experienced a steep drop in sales in the region during the fourth quarter.
From January through the end of November, Tesla sold 283,000 vehicles in Europe, an approximately 14% decline from the same period a year earlier, according to registration data from the European Automobile Manufacturers’ Association, or ACEA. Registrations in Europe slid to 18,786 in November from around 31,810 a year earlier.
The company’s business in China was also pressured in the fourth quarter.
Fiorani said that while the Model Y is the second bestselling model in China, “its growth is failing to keep up with growth of the market.” Through November, sales of the Model Y were up more than 5% but overall EV sales in the country rose 8%, he said.
Meanwhile, BYD and other brands in China, including Chery, Li Auto, Jetour, LeapMotor and Aito, grew substantially faster than Tesla. BYD is also setting up plants outside of China and exporting prodigiously.
In North America, Tesla has remained dominant. The company offered a range of incentives and price cuts, even on its most popular Model Y SUV, during the fourth quarter to drive sales. Still, Tesla experienced a buildup of inventory.
During the fourth quarter, the company sent Cybertruck assembly line workers home for a few days, indicating that it may be looking to avoid flooding the market with too many of the vehicles.
Looking ahead to 2025, Musk said on an earnings call in October that Tesla expects to be offering lower-cost and autonomous vehicles in 2025, which should lead to “20% to 30% growth” over 2024.
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