Bitcoin has gained significantly ever since Donald Trump made a comeback to the White House. The most traded cryptocurrency has achieved a significant milestone by crossing the $81,000 mark for the first time in history. The surge marked Bitcoin rise by 6%.
Earlier, Trump had been a strong critic of cryptocurrencies. However, the change in his stance has turned out to be one of the primary drivers behind Bitcoin’s recent growth – throughout his latest his presidential campaign, Trump promised to make the U.S. a leader in the global cryptocurrency market, pledging to turn the country into the “crypto capital of the planet.” The news of Trump’s victory in the elections saw Bitcoin’s price rise by over 10%, while its market cap clocked a growth to rise to $1.445 trillion. Bitcoin is currently priced at $80,561.52, having grown by 0.20% today (at the time of the writing of this article).
If this is not enough, Trump has also proposed to create a national Bitcoin stockpile, one that would leverage the potential of the world’s largest cryptocurrency as an asset, and appoint regulators who are more supportive of digital assets. This stance by Trump stands in stark contrast to the previous administration, under President Joe Biden, which took a more cautious approach to cryptocurrency. Biden’s tenure as US PResident saw the Securities and Exchange Commission (SEC), led by Gary Gensler, focus on regulating the crypto sector more aggressively, often citing concerns over fraud and market manipulation. This was particularly evident following the crash of the FTX exchange two years ago, which led to a series of high-profile collapses.
Trump’s relaxed stance on cryptos is not the only driver of Bitcoin’s rise to a new peak – other drivers in this growth include the increasing institutional interest in the cryptocurrency market, particularly through exchange-traded funds (ETFs). Bitcoin ETFs, such as the iShares Bitcoin Trust managed by BlackRock Inc., have become a rather popular investment vehicle, wherein institutional investors can now gain exposure to Bitcoin without directly purchasing the asset. These funds have seen substantial inflows, including a record $1.4 billion on one day, and provide much-needed liquidity and stability to the global crypto market. The results speak for themselves – Bitcoin has grown by about 93% so far this year.
Other factors include the Federal Reserve’s decision to cut interest rates – with lower interest rates, borrowing becomes cheaper, which in turn leads investors to seek higher-yielding assets (such as Bitcoin). Similarly, other digital assets, including Ethereum (Ether) and Dogecoin, have experienced growth with Trump’s win – Dogecoin, in particular, has benefited from celebrity endorsements, including that of Elon Musk, who is a known ally of Trump.
