Electrified by Trump, Bitcoin passes the $90,000 mark

Bitcoin crossed the $90,000 threshold for the first time in its history on Wednesday, with the cryptocurrency industry anticipating a more flexible legislation and economic policies that would be favorable to it under the future Trump administration.

The largest cryptocurrency by capitalization exceeded this level around 2:30 p.m. GMT and continued its ascent, exceeding $93,000 less than two hours later.

Since Donald Trump's victory in the US elections on November 5, the value of bitcoin has swelled by more than 30%. After surpassing its record high set in March, the digital currency climbed above $80,000 on Sunday.

While Mr. Trump had called cryptocurrencies a scam during his first term, he has since radically changed his position, even launching his own platform and certifying that he would make the United States “the bitcoin and cryptocurrency capital of the world.”

He also received significant financial support from groups related to the cryptocurrency world during his campaign.

Initially conceived as a way to escape the control of traditional financial institutions, bitcoin is based on blockchain technology, which functions as an unforgeable virtual ledger, keeping track of all transactions made.

Regulators have since sought to fill the legal void surrounding this digital asset, which has seen its share of controversies and is regularly stigmatized as a tool used by malicious actors to launder funds or scam individuals.

– Regulation and strategic stocks –

The American president-elect has for his part sworn to replace Gary Gensler, the head of the financial markets regulator, the SEC, hated by a sector that criticizes his repressive approach, and his choice to regulate cryptocurrencies like traditional financial securities.

“The fact that some crypto assets escape the definition of financial securities could greatly accelerate the approval of new investment products and increase the influx of capital into the sphere” of digital currencies, says Simon Peters of eToro, interviewed by AFP.

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Stéphane Ifrah, an analyst at Coinhouse, notes that many companies in the crypto world are in fact in favor of “MiCA-type regulation”, the European Union regulation, which notably provides for mandatory approval for service providers around digital assets, which “would make them run fewer legal risks” according to him.

In the United States, a bipartisan bill, called FIT21, widely adopted by the House of Representatives in May, and currently on the Senate desk, plans to give control back to another financial regulator, the CFTC, with a more pragmatic and less dogmatic than the SEC.

Another key measure Trump has mentioned during his campaign is the establishment of a strategic national reserve of bitcoins.

To establish it, the American government would commit to no longer selling the bitcoins already in its possession, mainly seized in the context of legal cases, currently numbering around 210,000, or the equivalent of around $19 billion at current prices, according to Simon Peters.

If such a project were to come to fruition, the United States could “potentially buy bitcoins on the open market,” speculates the analyst, boosting demand and the legitimacy of this digital asset.

– Wider public –

As much as it is criticized by the sector, the SEC has however given the green light this year to the launch in the United States of bitcoin and then ether ETFs, financial products backed by the price of these two cryptocurrencies.

This investment vehicle has allowed a wider audience to buy bitcoins.

The twelve bitcoin-backed ETF funds listed in the United States currently hold the equivalent of approximately $94 billion, or more than 5% of bitcoins in circulation, and have collected more than $27 billion in bitcoins since their launch on January 11, according to the SoSoValue website.

Finally, the price of bitcoin also soared at the start of the year due to the “halving”, a technical event that reduces the supply approximately every four years, by halving the bitcoin reward given to users (or “miners”) who operate this digital currency.

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