The Bitcoin rally sparked by US President-elect Donald Trump’s victory in early November is beginning to lose steam as we approach the end of 2024.

The cryptocurrency was trading around $93,670 at 6:34 a.m. on Monday in New York, which is roughly $15,000 below the all-time high reached in mid-December. Additionally, other smaller cryptocurrencies such as Ether and the well-known Dogecoin are also struggling to gain traction.

Read: Bitcoin pullback deepens after token’s record-breaking rally

Trump’s push for favorable crypto regulations and his backing for a national Bitcoin reserve have given a boost to digital assets.

Nonetheless, diminished hopes for interest rate cuts from the Federal Reserve have dampened speculative enthusiasm.

More clarity on US cryptocurrency regulations is expected once Trump assumes office on January 20. His stance is markedly different from that of President Joe Biden’s administration, which has enacted more stringent regulations on this often-contentious sector.

Chris Weston, head of research at Pepperstone Group, noted that “the momentum has fizzled out from the post-election shift” in Bitcoin, partly due to outflows from cryptocurrency-associated exchange-traded funds.

Meanwhile, software firm turned Bitcoin investor MicroStrategy Inc. has been on a buying spree in recent weeks. Market watchers are keen to see if the company, which holds more than $40 billion worth of the digital currency, will maintain its pattern of announcing Bitcoin purchases on Mondays.

The original cryptocurrency has surged about 120% this year, outperforming traditional investments such as global stocks and gold.

Bitcoin also more than doubled in 2023, marking a significant rebound from a prolonged bear market.

© 2024 Bloomberg

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