Bitcoin bulls wasted no time in celebrating after firebrand president-elect Donald Trump swooped to another shock victory in the US elections.
The world’s largest cryptocurrency soared past previous records to touch an intraday high of $75,400, marking one of the strongest single-day rallies in weeks.
Bitcoin has since pared back some of these gains, but it remains solidly above $74,000 for the time being.
While the markets and the US dollar are rallying across the board, bitcoin specifically has a lot at stake as Trump gears up for his second run at leading the country.
The pro-crypto candidate
Trump campaigned on a pro-crypto platform, at least in comparison to those who came before him, with overtures of lighter-touch regulation on the infamously ‘wild west’ sector made.
In Trump’s typically combative nature, he also promised to sack Gary Gensler, the hawkish chair of the Securities and Exchange Commission (although the president’s power to do so is not clear cut).
Gensler has been loathe to open up the markets to crypto fund managers despite consistent campaigning from heavy-duty fund managers like Blackrock (NYSE:BLK) and VanEck.
Despite his standoffishness, Gensler offered a partial olive branch to the crypto market by approving spot-bitcoin exchange-traded funds this January, followed by spot-Etherum ETFs in May.
Gensler’s bitcoin ETF approval ushered in a new era of institutional adoption of the OG cryptocurrency, leading to this year’s first bitcoin all-time high in March.
But there remains a sense that the crypto mob are working against Gensler than with him. However, if Trump is taken at his word, they might not be working against him for much longer.
Day one approaches
“On day one, I will fire Gary Gensler,” Trump declared to Nashville supporters in July. He vowed to create a “bitcoin and crypto presidential advisory council” to make rules “written by people who love your industry, not hate your industry”.
“If crypto is going to define the future, I want it to be mined, minted and made in the USA,” he boasted.
Whether that will be the top of Trump’s priorities on day one is anyone’s guess, but for some experts, the future is bright regardless.
“With Donald Trump’s election and his outspoken support for the cryptocurrency sector, we could very well be on the brink of a Bitcoin supercycle,” said Malcolm Palle, executive director and co-founder of Web3 investor Coinsilium Group Limited (AQSE:COIN, OTCQB:CINGF).
“Trump’s recent appointment of Howard Lutnick, CEO of Cantor Fitzgerald, as co-chair of his transition team signals a serious shift in policy toward digital assets.
“What’s more, Trump has openly criticised SEC Chairman Gary Gensler, whom he – and much of the crypto industry – see as a roadblock to innovation.
“Gensler’s strict approach has been frustrating for many, and the possibility of his removal is being viewed as a positive step toward regulation that actually fits the needs of this evolving industry.”
Bitcoin to 100k?
How far could bitcoin go?
“Right now, a lot of analysts are forecasting bitcoin to reach around $92,000, and personally, I think we could see it surpass $100,000 by the end of the year, given the strong market dynamics and this new tailwind from Trump’s administration,” said Palle.
“The Republican victory means that the party that's being very much pro-crypto is now in power in the US,” said Bitwise Asset Management European head Bradley Duke.
Gensler “hasn’t been particularly friendly or welcoming towards crypto”, Duke added.
Trump’s Republicans, on the other hand, “have already discussed having a bitcoin strategic reserve in the US, which in and of itself is useful, like kind of a national stockpile. They've also mentioned supporting bitcoin mining US soil”.
It’s “very likely that we'll see the exit of Gary Gensler as SEC chair”, Duke predicted. “These are all good headwinds, and the markets have responded accordingly”.