Bitcoin Surges Above $104K, Driven by Positive Inflation Data, Trump’s Optimism, and Coinbase’s Historic S&P 500 Inclusion
Bitcoin (BTC) surged back over the $104,000 mark on Tuesday, fueled by a combination of favorable inflation data, President Trump’s upbeat outlook on financial markets, and Coinbase’s upcoming inclusion in the S&P 500 index.
The Consumer Price Index (CPI) for April showed a slower-than-expected increase in inflation, easing concerns for the Federal Reserve, which has been grappling with inflationary pressures. With Fed Chair Jerome Powell scheduled to speak on Thursday, markets are hoping for additional clarity on the central bank’s next steps.
Adding to the positive sentiment, President Trump, speaking at the Saudi–U.S. Investment Forum in Riyadh, stated that financial markets “could go a lot higher,” further boosting market confidence.
Bitcoin briefly touched $105,000 before experiencing a slight pullback, currently trading around $104,400, marking a 2.4% increase over the past 24 hours. Other cryptocurrencies in the market also showed impressive gains, with Ethereum (ETH) rallying over 9% to $2,700. Tokens tied to decentralized finance protocols like Eigenlayer and EtherFi saw gains of 20-30%.
On the stock front, major indices continued their upward trajectory with the Nasdaq rising 1.6% and the S&P 500 gaining 0.75%. Coinbase (COIN), the major crypto exchange, experienced a 24% surge in its stock price, benefitting from its imminent inclusion in the S&P 500. Analysts predict that Coinbase could see up to $16 billion in buying pressure following the index change.
Institutional Interest and Regulatory Clarity Pave the Way for Continued Growth
Joel Kruger, a market strategist at LMAX Group, acknowledged that while the crypto market is currently consolidating following last week’s strong gains, the overall sentiment remains bullish. “While the market is taking a pause, the long-term outlook still points to significant growth,” said Kruger.
Kruger pointed to the increasing mainstream adoption of cryptocurrency, noting that Coinbase’s inclusion in the S&P 500 is a landmark achievement that signals the growing legitimacy of the sector. “This is a historic step for the crypto industry, and as institutional participation continues to expand, we could see a continued rally,” he explained.
He also highlighted the positive regulatory shift in the U.S., with SEC Chair Paul Atkins pledging to position the country as a global hub for cryptocurrency innovation. Kruger believes that this move could spark a new wave of institutional investment, should clear and favorable policies be implemented.
Paul Howard, senior director at Wincent, shared a similar perspective, emphasizing that while altcoins are benefiting from the current market rally, institutional investors will likely become more discerning. “This shift could lead to increased institutional capital, but only the most resilient projects will thrive as institutional participation grows,” Howard stated in a Telegram message.
Bitcoin’s Path to New All-Time Highs Remains Intact for 2025
Bitcoin remains less than 5% from its all-time highs set earlier this year, but analysts at Bitfinex are predicting a period of consolidation before another push higher. “Although Bitcoin has been on an impressive rally, we expect a short-term consolidation in the $104,000-$106,000 range,” Bitfinex analysts said. “This pause could push the timeline for a new all-time high into June.”
Looking further ahead, Bitfinex analysts are extremely optimistic, forecasting Bitcoin to reach between $150,000 and $180,000 by 2025-2026.
“Bitcoin’s long-term prospects are stronger than ever,” they concluded. “With institutional adoption on the rise, the growing availability of Bitcoin ETFs, and more favorable regulatory signals, Bitcoin is well-positioned to become a global macro reserve asset.”
