One bitcoin, which is legal tender in the Central American country, is currently worth more than $91,000. The world’s largest cryptocurrency by capitalization has seen a dizzying, albeit volatile, rise: five years ago it was trading around $8,000, and this year it started trading around $42,000.
Bitcoin hit a record high of $93,480 this week, rising to an all-time high before retreating somewhat. The cryptocurrency fever that broke out a few days ago shows no signs of abating, as its supporters believe that Donald Trump’s presidency will have a beneficial effect on its exchange rate. The world’s largest cryptocurrency has been one of the most spectacular performers in the week since the election, rising 32% since the November 5 election. Its smaller counterpart, ether, is also up 37% since Election Day, while dogecoin — an alternative, volatile token backed by pro-Trump billionaire Elon Musk — is up more than 150%.
“What we’ve seen since the election is that the market is hoping or realizing what this could mean for bitcoin in the mid- to long-term: a pro-bitcoin administration, senate and potential legislature that gives not just US citizens the right to to bitcoin’s self-determination, but potentially bitcoin can be a strategic reserve asset for the US Treasury,” said Damon Polistina, head of research at Eaglebrook. Regulatory uncertainty was one of the biggest a noxious cloud that hung over the sector and was a headwind for advisers encouraging their clients to invest in bitcoin.
Bitcoin advocates held a meeting in El Salvador on Friday, where they said the cryptocurrency’s recent rise in value since Donald Trump’s US election victory had fueled their expectations that the rate would continue to rise and gain wider acceptance around the world. Dozens of domestic and foreign “bitcoiners” met at the Adopting Bitcoin conference held near the Salvadoran capital, where the Central American country advertises itself as a center for the promotion of digital currency trade. Three years ago, President Nayib Bukele made El Salvador the first country in the world to make bitcoin legal tender alongside the US dollar. The decision provoked criticism from the International Monetary Fund, with which the country is negotiating a $1.3 billion loan.
Trump embraced digital assets during his campaign, promising to make the United States the “crypto capital of the planet” and build a national bitcoin stockpile. It’s unclear how and when that might happen, but the possibility has sparked a wave of speculation in crypto mining and trading stocks. According to Zach Pandl, head of research at Grayscale Investments, “the election results open the door for large, regulated businesses like banks, custodians and exchanges to participate in public blockchain technology in a way they haven’t before.” An example of such a circumvention method is buying shares in the software company MicroStrategy, because the company is now actually a bitcoin proxy; bought crypto-currency in such a quantity that its exchange rate is driven much more by bitcoin than by its core business. The company spent about $2 billion on bitcoin purchases between October 31 and November 10, and its shares have now soared to record highs.
Crypto investors see an end to increased scrutiny from the Securities and Exchange Commission under Trump. Trump and his sons announced a new crypto business, World Liberty Financial, in September. “Trump understands what it’s like to be a capitalist, he’s going to get out of the way and remove regulations that aren’t necessary,” said Charlie Stevens, a 27-year-old Irishman who has lived in El Salvador for a year and a half. “Bitcoin is growing very, very fast, in front of the whole world. And the whole world is watching El Salvador,” he added. In January, Vice President Felix Ulloa said that El Salvador remains committed to the digital currency, despite the fact that Salvadorans rarely use bitcoin and there are technical problems.
“Many believe that we will inevitably get to $100,000 for bitcoin,” said JJ Kinahan, CEO of IG North America. ” Others are advising investors not to get caught up in the crypto frenzy. “Now that bitcoin has reached $90,000 and a new historic peaked, investors should be cautious about the potential volatility ahead,” said Georgi Koreli, CEO of Hink.
Source: sg.hu
