Cryptocurrency market soars: Bitcoin gains 2.75% as investor optimism returns

Cryptocurrencies started the year on a positive note, bouncing back from recent losses as investor optimism returned to the market. Bitcoin's price climbed 1% on Thursday to $96,283.33, bringing its year-to-date gain to about 2.75%, factoring in trading from January 1. Earlier in the session, bitcoin reached a high of $97,256.15. The CoinDesk 20 index, which tracks the broader cryptocurrency market, rose 3%. Leading the gains was Solana’s token, a prominent Ethereum competitor, which surged nearly 7%. Crypto-related stocks also saw gains, with Coinbase and MicroStrategy each advancing 3%. The crypto industry is poised for a strong 2025, bolstered by expectations of a more favorable regulatory environment under President-elect Donald Trump. Investors are optimistic about Congress potentially passing its first-ever cryptocurrency-focused legislation, which might address stablecoins or market structure. Additionally, traders are anticipating an active year for crypto-related public offerings and developments in creating a national strategic bitcoin reserve. Cryptocurrency prices had slipped toward the end of 2024, as the post-election rally that propelled bitcoin to record highs above $100,000 waned. Despite this, bitcoin still ended the year with a gain of over 120%. The year-end pullback was driven by long-term holders taking profits and concerns over the Federal Reserve's direction on interest rate cuts for 2025.