The price of bitcoin has risen above $82,000 for the first time as it benefited from traders’ hopes that Donald Trump will favor cryptocurrencies when he returns to the White House.
Bitcoin hit an all-time high of $82,413, before falling back to around $82,000, a gain of about 2.8% on Monday. The price has more than doubled from $37,000 12 months ago.
In the past, Trump called Bitcoin a “dollar scam,” but changed his opinion on cryptocurrencies during the US presidential election campaign, courting the crypto community and appearing at industry events. This has raised expectations of a relaxation of rules to make it easier for retail savers to invest in bitcoin and other cryptocurrencies, although Trump has not specified any policies.
The deal with Trump has spread through world markets since his victory became clear, and the dollar has gained value as investors wait for a high-spending US government.
In China, investors are bracing for new high tariffs. Hong Kong’s Hang Seng Index fell 1.5% on Monday, which some investors said represented a disappointing response to China’s economic stimulus program announced last week.
While the debt swap programme, aimed at shoring up local government finances, was worth around 10tn yuan (£1.1tn), economists at Deutsche Bank said it “disappointed market expectations as it lacked direct fiscal stimulus and specific measures to improve the real estate market. ”.
Prices have also risen since the election for other cryptocurrencies such as ethereum and dogecoin, a meme coin previously backed by Elon Musk, the CEO of Tesla and owner of $26.5 billion shortly after. The election result was confirmed.
Trump even went so far as to back a cryptocurrency company, World Liberty Financial, run by his family in September, a move that could leave him open to criticism over potential conflicts of interest if he decides to deregulate digital assets. His son, Donald Trump Jr, has said cryptocurrencies offer an alternative to a banking system he says is tilted against conservatives.
Ronald Temple, chief market strategist at Lazard, an investment bank, said Trump had promised to fire Gary Gensler, chairman of the Securities Exchange Commission, “on day one” of his presidency.
“Gensler has advocated for stricter regulation of cryptocurrencies for much of his tenure” as head of the top US financial regulator, Temple added.
Share prices of publicly traded cryptocurrency companies also appear poised to benefit. Cryptocurrency exchange Coinbase is up 40% since the election result, and its share price rose another 16% in trading before the opening bell on Wall Street. Microstrategy, a software company whose founder led huge bitcoin purchases, rose 12% in pre-market trading.
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Bob Savage, head of market strategy and insights at BNY Mellon, a US investment bank, said bitcoin’s price movement was one of the “Trump trades” that seemed “central to judging the mood of the markets.” ” as investors try to figure it out. the impact of the elections.
Matt Simpson, senior market analyst at City Index, described the moves in cryptocurrency markets as a “Trump bomb” as traders bet the president-elect will usher in a period of cryptocurrency adoption.
The price of bitcoin correlated with Trump’s percentage of votes in opinion polls during the election campaign against Democratic candidate Kamala Harris. It was below $70,000 on Election Day last Tuesday, but has gained almost a fifth of its value since then. Some market observers believe the price could surpass $100,000 this week.
The surge has sparked a wave of excitement among cryptocurrency investors. Interest in cryptocurrencies tends to increase as prices rise. Data from Google Trends showed that the number of people searching for “bitcoin” online reached its highest level since early March, although it remained about half of the May 2021 peak, when prices soared as banks investment began to earn interest before collapsing.