Bitcoin soars to record high above $106,000 following Trump’s proposal for U.S. Bitcoin strategic reserve
Bitcoin surged to a record high above $106,000 on Monday after President-elect Donald Trump suggested he plans to create a U.S. bitcoin strategic reserve similar to its strategic oil reserve, stoking the enthusiasm of crypto bulls.
Bitcoin BTC=, the world’s biggest and best-known cryptocurrency, hit a high of $106,533 and last traded up 3.2% to $104,462. Smaller crypto ether ETH= rose 1.5% to $3,965.
“We’re in blue sky territory here,” said Tony Sycamore, an analyst at IG. “The next figure the market will be looking for is $110,000. The pullback that a lot of people were waiting for just didn’t happen, because now we’ve got this news.”
Investor sentiment also got a lift from the inclusion of MicroStrategy (MSTR.O) into the tech-heavy Nasdaq 100 index that will likely lead to more inflows for the software firm-turned-bitcoin buyer.
Thereby, the new year will usher in the bitcoin-friendly administration of President-elect Donald Trump and an expanding lobbying effort in statehouses that, together, could push states to become more open to crypto and for public pension funds and treasuries to buy into it.
Last week, Trump told CNBC about his intention to create a crypto reserve similar to oil reserves. However, analysts caution that such a move would take time to implement.
“I think we still need to be cautious on a BTC strategic reserve, and at least consider that this is not likely to happen anytime soon,” said Chris Weston, head of research at Pepperstone.
“Of course, any comment from Trump that offers an increased degree of hope that plans for a strategic reserve is evolving are an obvious tailwind, but this would come with consequences which would need to be carefully considered and well telegraphed to market players.”
Separately, governments around the world held 2.2% of bitcoin’s total supply as of July, according to data provider CoinGecko, with the United States possessing nearly 200,000 bitcoins valued at more than $20 billion at current levels.
China, UK, Bhutan, and El Salvador are the other countries with significant amount of bitcoins, data site Bitcoin Treasuries showed.
Other countries have also been considering cryptocurrency strategic reserves.
Earlier this month, Russian President Vladimir Putin said the current U.S. administration was undermining the U.S. dollar’s role as the global reserve currency by using it for political purposes, prompting many countries to seek alternative assets, including cryptocurrencies.
