Bitcoin price peaked continuously after Donald Trump was elected US President and had a plan to develop the digital currency market, investor psychology became more excited.
After soaring to 80,000 USD per coin on the evening of November 10 (Hanoi time), Bitcoin (BTC) set a new record late this morning with more than 81,858 USD. So since Donald Trump was determined to be the winning candidate in the race for the White House, BTC has established a new price level every day.
From the previous price range of around 69,000 USD per coin to the peak this morning, the world’s largest cryptocurrency has increased by about 12,700 USD, or nearly 18.5% in less than a week.
Mr. Trump’s victory is considered the main driving force for the new price increase. Forbes believes that this is not an unfounded belief when the cryptocurrency industry is the largest “donor” in this year’s election. A report by progressive consumer advocacy group Public Citizen found that contributions from the industry accounted for 44% of the business group’s total, as of August. Most of the money went through action committees PAC (PAC) specializes in voting for candidates who support cryptocurrency.
PACs funded primarily by cryptocurrency companies like Coinbase and Ripple have spent a total of $135 million supporting industry-friendly candidates in federal races, according to The New York Times. The investment appears to have paid off as as of November 10, 268 pro-crypto candidates had been elected to the House of Representatives and 19 candidates to the Senate, according to the nonprofit Stand With Crypto. This ratio is much more overwhelming than the 122 newly elected House members and 12 senators who are said to be “anti-cryptocurrency”.
President-elect Donald Trump promised during the election campaign to turn America into the “cryptocurrency capital of the planet”. His many commitments to the cryptocurrency community include launching a national cryptocurrency reserve with more than $16 billion in Bitcoin that the US government has accumulated through asset seizures.
Mr. Trump’s pro-cryptocurrency stance marks a reversal from his previous skepticism about the industry, which he called “scams.” Trump has repeatedly said he would “fire” US Securities Commission (SEC) Chairman Gary Gensler for taking more than 100 legal actions against cryptocurrencies during his term, according to CNBC. The new President also received support from cryptocurrency leaders such as billionaires Marc Andreessen, Cameron Winklevoss and Tyler Winklevoss. Meanwhile, Vice President-elect JD Vance is a longtime Bitcoin investor.
Mr. Trump and his campaign made personal investments in digital currencies when Trump’s joint fundraising committee began accepting donations through Coinbase in May. He launched his own family cryptocurrency platform itself, World Liberty Financial, in September.
US President Donald Trump at the Bitcoin 2024 event in Nashville (Tennessee, USA), July 2024. Image: Reuters
Donald Trump’s victory also brought many strong motivations for this market. According to statistics from one of the world’s most popular derivatives exchanges Deribit, there has been more than 2.8 billion USD of capital betting on Bitcoin to surpass 90,000 USD, which means placing call option orders. Additionally, derivatives exchange CME, which offers popular BTC futures contracts to institutional investors in the US, bets on Bitcoin prices increasing in the future. This creates a very positive level of crowd psychology, spreading throughout the market.
From a technical perspective, the analysis team CoinDesk also points out a number of reasons why Bitcoin’s price increase is reasonable. They used inflation data from the US Bureau of Labor Statistics to measure how much purchasing power Bitcoin has lost compared to previous years. The result is that the current price level only increases corresponding to the rate of price slide. BTC’s record in November 2021 was about 69,000 USD, after nearly three years it will slide to 78,000 USD. This suggests that current levels are only about 4.5% above inflation.
Besides, CoinDesk Also keep an eye on profit taking over the past few weeks. Glassnode data shows that on November 6 – the day after the US election, investors took profits of about 3.5 billion USD, this figure in the next two days was 3.2 billion USD.
However, this profit-taking level is very small compared to the March period when BTC surpassed the 2021 record. At that time, profit-taking activity skyrocketed to $10 billion. During the 2021 bull run, it also recorded $6 billion in profit-taking. The current level of profit taking is even lower than in 2017 – when Bitcoin was around 20,000 USD. This shows that investors are still patiently waiting for higher prices.
Besides, CoinDesk also points out that public interest in BTC is currently relatively low. The number of searches for the world’s largest cryptocurrency on Google is still lower than in November 2021 and March this year. This partly shows that the market is still a long way from reaching extreme excitement.