Bitcoin Surpasses $100,000 Amid Trump’s Crypto-Friendly Policy Shift
Bitcoin reached an all-time high of $103,853 late Wednesday, driven by investor optimism surrounding President-elect Donald Trump’s crypto-friendly stance. Since Election Day, the digital currency has soared more than 40%, achieving record highs in rapid succession. The rally was sparked when Trump appointed Paul Atkins, a former regulator known for his pro-crypto views, to lead the Securities and Exchange Commission (SEC). Trump had previously softened his position on bitcoin during his campaign, vowing to end Joe Biden’s war on crypto.
Crypto Sector Embraces the Incoming Administration
The crypto industry, once a rebellious outsider, now embraces the incoming U.S. administration in a dramatic shift. The sector’s mainstream acceptance raised its total value to over $3 trillion, enriching digital currency moguls. Tim Swanson, head of market intelligence at Clearmatics, pointed out the irony. “Bitcoin aimed to create an alternative payment system outside traditional finance, yet bitcoiners now seek government involvement, even subsidies.”
Trump’s National Reserve for Bitcoin
Trump plans to establish a strategic national reserve for government-held bitcoin, potentially boosting its value by absorbing supply. He also promises to ease the regulatory burden on the crypto industry. SEC Chair Gary Gensler, a vocal critic of digital currencies, is expected to resign on Inauguration Day. Trump pledged to remove him for warning about the risks of crypto fraud and manipulation.
Bitcoin’s Limited Supply and Bullish Outlook
Bitcoin’s capped supply of 21 million coins, expected to fully circulate by 2140, excites investors and organizations like Tesla. Tesla and MicroStrategy have accumulated substantial bitcoin holdings, viewing large hoards as a bullish signal. This optimism further drives the asset’s rise, attracting more investors. Analysts remain cautious, pointing out bitcoin’s volatility and questioning if its record-setting price will last.
Bitcoin ETF Sparks Monochrome Encounters: Fresh Risk Oversight Dilemma Unfolds
Bitcoin ETF: In the aftermath of the Securities and Exchange Commission’s (SEC) groundbreaking approval of U.S. exchange-traded funds (ETFs) holding Bitcoin, Grayscale Investments, a pioneer in cryptocurrency asset management,
Shift from ‘Payment Method’ to ‘Digital Gold’
Originally envisioned by bitcoin’s pseudonymous creator, Satoshi Nakamoto, as a decentralized payment system, the cryptocurrency increasingly serves as “digital gold” and a hedge against inflation.. Federal Reserve Chair Jerome Powell acknowledged this shift, stating, “It’s not competing with the dollar; it’s competing with gold.” His comments likely contributed to the recent surge, propelling bitcoin past $100,000.
Legislative Support and Crypto’s Political Clout
The political landscape for crypto has shifted as well. Once wary of the sector, Washington now appears more inclined to pass legislation favorable to the crypto industry. A wave of campaign contributions and increasing political support has led to the defeat of anti-crypto lawmakers, with pro-crypto representatives and senators now outnumbering their critics nearly two-to-one.
Bitcoin ETFs Become Popular Investment Vehicles
Bitcoin ETFs, which hold actual bitcoin, have gained popularity since their introduction, fueling the cryptocurrency’s rise. More than $7 billion has flowed into U.S. spot bitcoin ETFs since Election Day, according to Morningstar Direct. The ease of investing in bitcoin via traditional financial vehicles, such as ETFs, marks a shift from the early days when crypto enthusiasts used cryptographic keys to access their coins. Now, platforms like Coinbase offer more user-friendly ways to invest.
The Future of Bitcoin Remains Uncertain
Despite its recent success, bitcoin’s future remains uncertain. The cryptocurrency’s notorious volatility means that the surge to over $100,000 could be followed by a dramatic decline. In 2017, bitcoin nearly hit $20,000 before crashing. Similarly, after reaching nearly $69,000 in 2021, the currency fell to under $16,000 following the collapse of FTX. However, with growing institutional interest and increasing political support, bitcoin’s journey toward mainstream acceptance appears unstoppable for now.
