Bitcoin smashes through R2m

Bitcoin (BTC) smashed through R2 million for the first time over the weekend, just hours before Donald Trump’s inauguration as US president.

This comes just over three years after BTC broke R1 million. It then fell more than 70% to R281 00 in December 2022.

Since then, it’s been one-way traffic, with a sevenfold increase in price. Trump is seen as more crypto-friendly than the outgoing Joe Biden, and he has signalled his intention to support regulations that will stimulate bitcoin mining in the US, perhaps even creating a bitcoin “strategic reserve,” similar to the US petroleum reserve, which is used as a cushion in emergencies.

The idea behind a strategic bitcoin reserve is to retain the US dollar as the world reserve currency and discourage others from using BTC as an alternative.

That, and the prospect of lower US interest rates in 2025, created a rush for riskier assets such as BTC, which touched $ 106 000 over the weekend.

Bitcoin in ZAR

Source: Google

Trump signalled his pro-crypto agenda throughout his presidential campaign and, in July 2024, gave the keynote address at the bitcoin conference in Nashville, Tennessee.

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Reuters reports that he is expected to use his executive powers to reduce the regulatory burden on crypto companies within his first days in office.

One measure he is expected to announce is the appointment of a crypto council, which will advise his administration on crypto-friendly policies.

To the delight of many in the crypto community, Securities and Exchange Commission (SEC) chair Gary Gensler announced his retirement after Trump won the election in November last year. He was seen as hostile to crypto, which (barring bitcoin) is classified by the SEC as securities much like Apple or Tesla stock.

His replacement is Paul Atkins, a crypto enthusiast who previously worked for Token Alliance, a digital assets advocacy group. Atkins criticised the SEC under Gensler and its often confusing and overzealous approach to regulation, which resulted in court cases against crypto platforms such as Ripple, Binance, Kraken, and Coinbase. Trump threatened to fire Gensler (even though he lacks the power to do so), who brought more than 100 cases against crypto firms during his term of office.

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There is widespread hope in the crypto community that Atkins will drive a more coherent and less litigious approach to the crypto sector while providing clearer guidance on what digital assets are securities. So far, its approach has been criticised both in court and in the public for overreach and vagueness.

Atkins is also expected to end the practice of banks freezing crypto companies out of the traditional financial system by denying them services.

With a new boss at the SEC helm, big-money investors are enthusiastic about crypto. Inflows to bitcoin and ether exchange-traded funds (ETFs) attracted $44 billion and $2.3 billion, respectively, in 2024, and that figure is expected to continue growing in 2025.

XRP (Ripple) and Solana (SOL) are likely next in line for US regulatory approval to operate ETFs. Banking group JPMorgan suggests that these two could attract $14 billion in investment within the first year.

This article was republished from Moneyweb. Read the original here.