Bitcoin recently achieved a historic milestone by surpassing 90,000 USD, driven by factors like increased institutional engagement, corporate investments, and a more favorable stance from the Trump administration. Experts highlight potential regulatory changes, including a supportive framework and leadership shifts at the SEC. Trump’s interest in cryptocurrencies, including strategic Bitcoin reserves, may reshape the US crypto landscape, potentially benefiting Switzerland, although there are concerns about capital migration to the US.
Bitcoin’s Recent Surge: What You Need to Know
Last week, Bitcoin made headlines by reaching unprecedented heights. On Tuesday evening, it broke through the 90,000 US dollars threshold for the first time ever. Since the recent US election, where Donald Trump secured a second term as president, the cryptocurrency has surged by approximately 30%. This upward trend peaked on Wednesday at 93,483 dollars, but the momentum has since slowed.
Factors Behind Bitcoin’s Record Price
According to crypto expert Fabian Schär, pinpointing a singular cause for Bitcoin’s surge is challenging. However, he highlights several key contributors to this unprecedented price increase:
- Professionalization of the Crypto Sector: Financial institutions, including banks, asset managers, and insurance companies, are increasingly engaging with the cryptocurrency market and offering crypto-related products.
- Corporate Investment in Bitcoin: Major corporations are integrating Bitcoin into their financial strategies. Notably, Microstrategy revealed a massive investment of 42 billion dollars earlier this month.
- Trump’s Presidency: Trump’s current administration appears to adopt a more favorable stance towards cryptocurrencies compared to previous years.
Trump’s Vision for the US Crypto Landscape While specific plans remain unclear, Schär outlines several potential initiatives that could redefine the US crypto environment:
- A more transparent and supportive regulatory framework for the cryptocurrency sector.
- A potential leadership change at the US Securities and Exchange Commission (SEC): Current head Gary Gensler has been viewed as unfriendly towards crypto, and there are expectations he may soon depart. If he remains, Trump has indicated he may pursue his dismissal.
- Support from Crypto-Friendly Republicans: Schär notes that the Republican party is generally perceived as more supportive of crypto compared to their Democratic counterparts.
- Strategic Bitcoin Reserves: During a Bitcoin conference, Trump proposed the idea of the US creating strategic reserves of Bitcoin. He suggested that the government would cease selling Bitcoins acquired through criminal proceedings. However, Schär points out that this initiative faces challenges due to the Federal Reserve’s authority.
Prospects for Improved Conditions Under Trump’s Leadership Schär believes that Trump’s circle includes several pro-crypto figures, such as his vice president J.D. Vance, and influential personalities like Elon Musk and Robert F. Kennedy. Additionally, Trump’s foray into the world of NFTs (Non-Fungible Tokens) further signifies his interest in the crypto space. The favorable predictions regarding election outcomes on blockchain-based “Prediction Markets” may have also positively influenced his perception of the cryptocurrency industry.
How Might Switzerland Gain from Trump’s Presidency? With the US wielding considerable influence over global regulations, Schär suggests that Switzerland could benefit from a more favorable global climate regarding cryptocurrencies. However, there are worries that if the US becomes increasingly crypto-friendly, some business activities may migrate from Switzerland to the US.