Bitcoin rose above a record high of $75,000 following news that former President Donald Trump was successful in the polls on Election Day.

The Republican president-elect sparked investor enthusiasm for cryptocurrencies during the election campaign and promised to make the US the “crypto capital of the planet.”

In early morning trading, the digital asset rose nearly eight percent, surpassing its previous record set in March. Other cryptocurrencies followed the upward trend; Ether, the world's second-largest cryptocurrency, also gained eight percent, while Dogecoin, famously favored by billionaire Elon Musk, rose 18 percent.

Trump's changing stance on digital currencies during his campaign fueled this growth. Trump, once a crypto skeptic, has since joined the industry and proposed a “strategic reserve” of Bitcoin, similar to what the US does with gold.

His campaign accepted cryptocurrency donations and he courted crypto enthusiasts at a Bitcoin conference in July. This culminated in Trump and his family founding World Liberty Financial, a company dedicated to trading in this space and hoping for $300 million in token sales.

“Bitcoin is the one asset that was always going to rise if Trump returned to the White House,” said Russ Mold, investment director at AJ Bell.

After the recent rise, “the market is now speculating about when, not if, it will break $100,000,” he said.

Why is Bitcoin rising because of Donald Trump?

The optimism surrounding Trump's pro-crypto stance has buoyed the digital asset community, which expects more lenient regulations under his administration.

Trump has expressed his intention to replace current SEC Chairman Gary Gensler, who has led a crackdown on an industry that most governments still struggle to regulate.

A 2023 Pew Research Center survey found that only 17 percent of U.S. adults have ever purchased cryptocurrencies, most of them men under 50.

“Tonight the crypto voter spoke decisively – across party lines and in important elections across the country,” said Brian Armstrong, CEO of Coinbase, one of the largest cryptocurrency exchanges.

“Americans care disproportionately about crypto and want clear rules of the road for digital assets. We look forward to working with the new Congress to implement these,” he wrote on X, formerly known as Twitter.

A “Light Touch” Approach to Crypto Regulation

Market analysts remain divided on the long-term impact of Trump's victory on the crypto market.

While some investors see the potential for explosive growth, others warn about the market's notorious volatility. The space has seen ups and downs during the NFT bubble and COVID-19, when Bitcoin was worth less than 10 percent of its current value.

“Investors should only venture into cryptocurrencies with money they can expect to lose,” said Susannah Streeter, head of money and markets at Hargreaves Lansdown. “Because we’ve seen these wild swings in the past,” she added.

Many crypto advocates, who view the existing regulatory environment as restrictive, hope that Trump's presidency could include a “light-touch” approach.

She agreed that crypto enthusiasts would prefer to see this as Trump's presidency takes shape.

“They want cryptocurrencies to give the appearance of legitimacy, but they don’t want regulations to be too strict to prevent opportunity and innovation.”

Will Bitcoin Reach $100,000?

Crypto enthusiasts are now speculating whether Bitcoin's momentum could push its value to $100,000. Bitcoin has already gained 77 percent this year, and given recent developments, investors are increasingly bullish on digital assets.

“Trump has already declared his love for digital currency and crypto traders now have a new narrative to get even more excited about where the price could go,” Mold said.

Until then, Bitcoin's continued rise depends on whether Trump can keep his promises to make the US more crypto-friendly. His most prominent tech backers, including Musk, who donated $119 million to fund a super PAC aimed at securing his re-election, are likely to be available as advisers.

“The people of America gave @realDonaldTrump a crystal clear mandate for change tonight,” he wrote on social media platform X as Trump was ahead in the polls.

“America is a nation of builders. Soon you will be free to build.”

This article contains reporting from The Associated Press