Bitcoin's latest record-setting rally came gradually, then suddenly.

After edging up to around $112,000 to snag its first record in months last Wednesday, the world's biggest cryptocurrency spiked dramatically over the following days.

Its latest jump has pushed bitcoin's total market value to nearly $2.4 trillion, above that of mega-cap tech firms like Alphabet and Meta Platforms.

Here are three things that have driven bitcoin's rapid climb above $120,000.

Monday marked the start of crypto week in Washington, DC, with investors banking on lawmakers' debates over a series of crypto-related bills set to create fresh tailwinds. Here are the key bills that markets are watching for:

The prospect of new regulation is ironing out some of the uncertainty associated with crypto assets, and encouraging more institutional investment, Oku Markets' Mills added.

Stablecoins have already been in the spotlight since the GENIUS Act passed in the Senate last month, and any legislative support for the broader space will likely be cheered by investors who have been clamoring for stronger government backing and regulatory clarity for digital assets.

"The decisive point is: the roadblocks are gone. From a regulatory standpoint, there are no more obstacles in the U.S. — quite the opposite. Capital markets are open. The world's largest economy is no longer neutral, but explicitly pro-crypto. Adoption is in full swing," Eric Demuth, CEO of Bitpanda, said on Monday.

According to an analysis published by CoinShare, digital asset investment products saw around $3.7 billion of inflows last week, the second-largest weekly amount on record.

Meanwhile, spot bitcoin ETFs took in $1.22 billion last Thursday, according to data compiled by The Block, the largest daily inflow into bitcoin funds since Trump won the presidential election.

Enthusiasm for bitcoin is also taking hold among corporates. Bitcoin treasury strategies are on the rise, looking to duplicate the success of Michael Saylor's bitcoin proxy, Strategy. Metaplanet, a Japanese bitcoin Treasury, said it purchased another 797 bitcoin on Monday for around $94 million.

Strategy, for its part, also said it purchased more than 4,200 bitcoin in the last week for around $472 million, a regulatory filing shows.

According to Bloomberg, Twenty One Capital, Nakamoto Holdings, and ProCap Financial are among the bitcoin holders that have initiated a SPAC or a reverse merger this year.

Investors are flocking toward bitcoin, partly due to dampened confidence in other US assets as President Donald Trump adds fuel to his trade war.

US stocks were under pressure again on Monday as traders weighed the impact of Trump's newly announced tariffs, which include a 30% tariff on the EU and Mexico announced over the weekend.

Macroeconomic tailwinds are one factor that's helped push bitcoin's price higher, according to Prem Raja, the head of trading at Currencies 4 You.

"With the Dollar under pressure, markets have entered a risk-on phase, driving capital into equities, tech, and digital assets," Raja wrote in a note.

"Bitcoin's nature as a decentralised, global asset, unaffected by corporate earnings or domestic currency exposure, has made it particularly attractive amidst trade tensions, corporate margin pressures and rising stagflation concerns," Anita Wright, a chartered financial planner, said.