Bitcoin extended gains Monday to hit a new milestone, breaking past $120,000, fueled by a rally in the cryptocurrency's ETFs.

The price of the largest cryptocurrency by market capitalization topped $122,600 at 1:27 p.m. Singapore time, according to data from Coin Metrics.

The rally has seen bitcoin reach new highs amid more inflows into bitcoin ETFs. On Thursday, bitcoin ETFs had logged their biggest day of inflows in 2025 at $1.18 billion.

"We believe that Bitcoin's surge is driven by longer-term institutional buyers and this will propel it to $125k in the next month or two," Jeff Mei, chief operating officer at cryptocurrency exchange BTSE, said in a statement sent to CNBC. 

"Trump's trade disputes with the likes of the EU, Mexico, and other trading partners could cause dips in the week ahead, but it's likely that Bitcoin's institutional buyers are discounting this risk and maintaining their positions that Bitcoin will still appreciate in the long run," he added.

'Crypto Week'

Investors have been anticipating bitcoin to hit new records this year as corporate treasuries accelerate their bitcoin buying sprees and U.S. Congress nears the passing of new crypto legislation.

The U.S. House of Representatives will begin deliberating on a series of crypto bills on Monday in what has been dubbed 'Crypto Week.' The potential laws are aimed at providing a clearer regulatory framework for the digital asset industry. 

The policy had been long sought by the industry, and is supported by U.S. President Donald Trump, who has branded himself as a pro-crypto President and is involved in several crypto ventures.

One of the most significant bills under consideration is the Genius Act, which could establish federal guardrails for U.S. dollar-pegged stablecoins and create a pathway for private companies to issue digital dollars.

"Long-term holders are locking up supply, while global policy clarity — especially around stablecoins and crypto legislation — has boosted investor confidence and capital inflows," Xu Han, director of the Liquid Fund at HashKey Capital, said in a statement to CNBC.

Speaking on CNBC's "Access Middle East," Markus Thielen, CEO of 10x Research, said that he hopes that the U.S. will announce a sovereign wealth fund that could purchase digital currencies, also an overhanging factor market.

He noted that corporate and institutional investors have purchased $15 billion in Bitcoin ETFs over the last six to eight weeks. In contrast, retail investors appear to have been on the sidelines during the latest rally, he added.

10x Research has a year-end Bitcoin target range of $140,000 to $160,000, Thielen revealed, but the most significant risk facing this remains the U.S. Federal Reserve continuing its hawkish policy and further interest rate hikes due to tariffs.