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.

1. Crypto week

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.

2. Strong institutional demand

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.