Bitcoin has soared to a record high, driven by renewed investor interest and significant institutional backing. The cryptocurrency reached an all-time peak of $107,791 on Monday, marking a historic milestone in its trading history.

Key Drivers Behind the Surge

The rally isn’t solely attributed to President-elect Donald Trump’s proposed policies, though his pledge to create a favorable regulatory environment for digital assets has fueled market optimism. Speculation also surrounds the potential establishment of a US strategic reserve held in Bitcoin, adding further momentum.

Another critical factor is MicroStrategy’s aggressive investment strategy. The software giant has invested billions into Bitcoin, holding an estimated $45 billion worth of the digital currency, according to Bloomberg. On Monday, the company announced an additional $1.5 billion Bitcoin purchase, further reinforcing market confidence.

Stock Market Influence

The US stock market has played a pivotal role in Bitcoin’s upward trajectory. MicroStrategy’s upcoming inclusion in the Nasdaq 100 index is expected to trigger significant institutional investments, as index funds will be required to buy shares of the company.

“Index funds can now purchase MicroStrategy shares, enabling the company to raise more equity for additional Bitcoin acquisitions,” explained Sean McNulty of Arbelos Markets to Bloomberg.

Retail Investors Join the Frenzy

Bitcoin’s meteoric rise hasn’t gone unnoticed by individual investors. Many retail traders, previously hesitant to enter the volatile crypto market, are now drawn by the skyrocketing prices.

In November alone, US Bitcoin ETFs attracted approximately $7.2 billion in new investments. This capital inflow also set a new record, boosting the combined assets of the 12 largest Bitcoin ETFs to over $113 billion since January, according to Bloomberg.

With both institutional and retail investors fueling the Bitcoin market, the question remains: Will this unprecedented surge endure, or is a market correction inevitable?