Trump's cryptorally: how much bitcoin could rise
The bitcoin exchange rate has continued to rush upwards in the last two weeks, approaching the six-figure number. The growth of cryptocurrencies (bitcoin in the first place, but others are also strengthening) is definitely related to the election of Donald Trump as US President - he has big plans for the digital currency. At the same time, there is no reason to talk about the transformation of "crypto" into a globally recognized means of payment. About to what limits the bitcoin rally can continue, in the material "Izvestia".
The effect of the election
Over the past 20 days, bitcoin has experienced an upward spurt, too sharp even for this extremely volatile asset - one and a half times from $66-67 thousand. During trading on November 22, it crossed the $99 thousand mark, but has not yet reached the 100-thousand mark. However, given the support that the most popular cryptocurrency has received from the political front, it is hardly surprising.
Donald Trump, back during the campaign, talked a lot about promoting cryptocurrencies nationally and internationally. In one of his speeches, he promised to turn the US into a "bitcoin superpower" and the "cryptocurrency capital of the world." He confirmed his words with deeds, announcing the creation of his family's own crypto-business (though without details yet). His team includes several supporters of digital assets, including Ilon Musk.
In addition, Trump promised to fire the chairman of the US Securities and Exchange Commission (SEC), Harry Gensler, who is considered an opponent of cryptocurrencies and hinders the development of the industry in the country with the largest financial market in the world, immediately after the inauguration. The amount of donations to the presidential campaign also shows quite clearly that of the two candidates, the crypto industry clearly favored Trump, although Kamala Harris also tried to give some signs of attention to the growing sector. Finally, Trump has stated a desire to create a strategic bitcoin reserve, similar to a gold reserve.
In addition to Trump's success, other factors have also affected the growth of cryptocurrencies. Large investment funds (such as Vanguard and Blackrock) have been actively buying bitcoin all this year. We are talking about purchases worth billions of dollars in recent months. This inevitably puts upward pressure on the exchange rate. Of course, the trend may reverse at the moment if institutional investors want to lock in profits. But so far, nothing like that is happening. By the way, etherium is growing somewhat more modestly (by about a third since November 5), which indicates increased investment activity in bitcoin.
Finally, there are also global considerations related to the loss of confidence in fiat currencies. It's happening gradually, but similar thoughts visit everyone who wants to switch to alternatives. Gold, after all, has also set several consecutive records in the past months. With the dollar and euro becoming weapons of choice, and public debt in major economies rising like crazy, a neutral asset could be a safe haven of sorts.
One million bitcoins in the ZVR
Yet the fundamental problems with bitcoin remain in place. We can talk a lot about security or transparency, but the key one is still utilitarian. The system can only do 6-8 transactions per second, which is ridiculous for a global currency. For comparison, Visa and Mastercard payment systems are capable of tens of thousands of transactions per second, Russia's NSPK - 4-5 thousand at its maximum. Significant activation of bitcoin payments will cause the whole system to slow down dramatically and cease to be so convenient.
According to Nikolay Dudchenko, analyst at Finam FG, the rushes of recent months still do not allow us to talk about the institutionalization of cryptocurrency.
- Especially such conclusions can not be made because of the strong price growth on the same bitcoin or other cryptocurrencies, - says the expert. - At the moment, the price growth is due to a positive external background. The classic market rule "buy on rumors" applies.
According to him, according to the draft law, implying the creation of a strategic reserve of bitcoin, in accordance with the original plan is supposed to purchase the U.S. Treasury Department 200 thousand bitcoins each year for five years - a total of about a million bitcoins.
- At the current bitcoin value of about $100 thousand, the amount would be $100 billion. The Ministry of Finance would be obliged to keep the cryptocurrency for 20 years and use it to reduce the national debt. The adoption of this kind of plan can certainly increase the demand for cryptocurrency. However, details are important here," Dudchenko emphasizes. -For example, the price at which the U.S. Ministry of Finance will buy bitcoin; the terms in which this cryptocurrency should be purchased; the conditions for further use of bitcoin to reduce the national debt.
The analyst added that one cannot also rule out the risk that the bill will remain "on paper", which will lead to disappointment of market participants.
- It's still a bit early to talk about full-fledged institutionalization," said crypto expert Alexei Krichevsky. - But the fact that the use of cryptocurrency and cryptoassets is growing is hard to deny. Yes, so far the list of countries that have recognized crypto as a full-fledged means of payment and replenish their reserves with coins is not so large, but it will gradually grow, especially if the U.S. after Trump's arrival will sharply begin to ease pressure on this sector, as it was under Gensler and Biden. The temporary hype is more about the much-hyped rise of bitcoin and a few other coins, but the trend is still clear - further price increases are inevitable.
Annual doubling
Alexei Krichevsky believes that bitcoin will reach 100 thousand already this month - there is not much left to go through.
- What will happen next is a billion-dollar question. Forecasts of investment houses vary greatly, but they all agree that the growth will be very serious, - he notes. - Unless there are some unique events in this market and global shocks, bitcoin could easily double annually during Trump's presidency. Actually, the same can be said about other top coins - ETH, TON, SOL, XRP.
In turn, Nikolay Dudchenko notes that the prospects of the crypto market are still vague:
- The market lives by expectations, which are now mostly positive, which is translated into the price. On the other hand, it is impossible to exclude disappointment of the markets after Trump's inauguration. One should be aware that bitcoin investments continue to be highly risky.
The irony of the emerging situation is that cryptocurrencies, which were originally created as an anarchic and libertarian financial system that distanced itself as much as possible from government institutions, are now getting a second wind thanks to public policy - or at least its promises. "Crypto" has recently been legalized in Russia, and heads of state who bet on bitcoin, like President Nayib Bukele of El Salvador, who was able to earn several hundred million dollars for his treasury thanks to investments from ZVR, are no longer so original.
