Trump's crypto boost: Bitcoin hits record £62,000 high
The favourability of President-elect Donald Trump towards cryptocurrencies has invigorated the market and led to an influx of capital. The price of Bitcoin, the most popular virtual currency, briefly surpassed the barrier of £62,000 on Sunday, setting another valuation record.
The cryptocurrency market is experiencing a boom. Bitcoin, the highest-valued virtual currency, broke the £62,000 barrier for the first time in history on Sunday, but then dropped back below that amount. The increased demand for this cryptocurrency can be attributed to Donald Trump, the President-elect, who promised during his election campaign to make the United States the "crypto capital of the planet."
According to some analysts, Bitcoin might reach the value of £77,500 in January, before Trump's inauguration. Another factor driving the current rise in Bitcoin's price, besides Trump's victory, is the Federal Reserve's decision to cut interest rates by 0.25%. According to Thursday's Fed decision, interest rates in the US will now be between 4.5% and 4.75%.
A turn toward cryptocurrencies
As Bloomberg notes, Trump's position contrasts with the crackdown on cryptocurrencies under President Joe Biden. Gary Gensler, the Chairman of the Securities and Exchange Commission (SEC), has repeatedly described the sector as full of fraud and misconduct. The Commission tightened regulations on cryptocurrencies following the market crash in 2022 and a series of bankruptcies, notably the fraudulent exchange FTX run by Sam Bankman-Fried.
Let's remember that during his first presidency, and even afterwards, Donald Trump often spoke negatively about Bitcoin. The situation changed this year. During the race for the US presidency against the Democrats (first Joe Biden, and after his withdrawal, Kamala Harris), Trump began to ingratiate himself with the crypto industry through controversial promises.
Digital asset companies and their management spent huge amounts on promoting candidates perceived as favourable to their interests during the US election campaign. As reported by "The New Yorker," entrepreneurs associated with cryptocurrencies accounted for nearly half of the corporate donations that funded the election campaign through the Super PAC fund.
Noelle Acheson, author of the newsletter Crypto Is Macro Now wrote that Trump pledged supportive regulations, and the victory of the House of Representatives and the Senate makes the passage of cryptocurrency-related legislation much more likely.
