Trump's crypto promise fuels Bitcoin's 25% surge
Bitcoin on Wednesday reached approximately £71,000. This is slightly lower than the recently recorded rate of £72,500, but the cryptocurrency is evidently coming back into favour among investors. One of the main reasons for the increase is Donald Trump's political declarations. The virtual coin's value has risen by almost a quarter since his victory.
Bitcoin is breaking more records and surpassing limits that seemed unattainable not long ago. On Wednesday, the cryptocurrency was valued at £71,000. This represents a slight drop from the record £72,500, but still, virtual coins are worth the most in years, including during the pandemic period.
Bitcoin increased by 25%
What influenced the rate? Artur Babicz, an analyst at XTB, notes that the period since Donald Trump's presidential election has proven extremely successful for cryptocurrency investors. The expert points out that bitcoin increased by over 25% during this time and approached the £73,000 level.
- Such dynamic increases are connected with expectations of easing legislation on cryptocurrencies by the new president's entourage - states the XTB expert. He also recalls that "during the election campaign, Donald Trump participated, among other things, in a conference dedicated to Bitcoin."
- Such a dramatic move in the cryptocurrency may also be due to reports about the possible allocation of part of the state reserves in Bitcoin - emphasises the expert. He points out that Donald Trump himself mentioned creating a U.S. Bitcoin reserve, which would aim to reduce debt in the future.
Will Bitcoin become more expensive?
Babicz observes that MicroStrategy's consistent demand for cryptocurrency is noticeable. The company plans to increase its reserves by around £33.5 billion over the next three years. He adds that "record fund inflows into cryptocurrency ETFs contribute to their value increase."
- If the announcements about the inclusion of more countries accumulating part of their currency reserves in Bitcoin are confirmed, one can expect a further price increase in the cryptocurrency at a similar pace - explains the XTB analyst.
He also emphasises that "demand from countries may be characterised by greater determination and stability."
Babicz adds that this "will directly translate into further Bitcoin price increases and companies related to the cryptocurrency market." The expert also notes that "the shares of companies operating in the blockchain sector, involved in cryptocurrency mining or investing directly in Bitcoin, are showing very good post-election results."
