Bitcoin surged to a new record high on Monday morning, with other prominent cryptocurrencies such as ethereum and XRP on the up, ahead of the inauguration as US President of Donald Trump and an expected more friendly administration for digital currencies.
Against the dollar, bitcoin climbed above $108,600, a 4% gain over 24 hours, after falling below $100,000 overnight.
Early last week, bitcoin prices had retreated to $90,000, marking a 17.5% decline from their previous peak, while the previous week US spot bitcoin ETFs experienced their second-largest outflow since their inception, with investors withdrawing a net $583 million on a single day.
The rebound on Monday was alongside other parts of the financial market, which analysts suggested was linked to Trump.
"A reportedly positive phone call between US President Donald Trump and Chinese President Xi Jinping sparked a fresh rally," said analyst Kyle Rodda at Capital.com.
"Bitcoin also surged and gold prices appear to be breaking out after a period of consolidation."
He said it was "particularly telling" that Asian indices were firmer today, having barely moved after much stronger than expected Chinese growth data at the end of last week.
"Combined with diminished fears about stickier and even re-accelerating inflation, the amicable call between Trump and Xi, while only a temporary reprieve amidst irrevocable strategic competition, is extra fuel to reignite bullishness in equities."
The cryptocurrency market, particularly Bitcoin, showed "remarkable dynamics" in 2024, Deutsche Bank said, with Bitcoin prices increasing 120% over the year 2024 and 33% since the November Trump victory.