“Bitcoin recovers from biggest drop since US electionBitcoin fell 3% over the weekend but recovered to $92,000 after the US election. Trump has promised to create a friendly regulatory framework for cryptocurrencies, but experts doubt that all promises will be implemented.”, — write on: unn.ua
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The digital asset fell nearly 3% over Saturday and Sunday before rebounding to $92,000 as of 7:05 a.m. Monday in London (9:05 a.m. GMT). Trump has made several pro-cryptocurrency promises, but questions remain open about the timing of their implementation and the feasibility of all of them – for example, about the creation of a stock of bitcoins in the United States.
Bitcoin has become “overheated” after a record rally since election day on Nov. 5, and “there was a lot of good news embedded in the price,” IG Australia Pty market analyst Tony Sycamore wrote in a note.
While Trump’s business-friendly stance has inspired investors in U.S. stocks and cryptocurrencies, some of the optimism is tempered by inflationary risks due to the prospect of trade tariffs and deficit spending to finance tax breaks, the newspaper said.
Investors are reducing expectations for interest rate cuts by the Federal Reserve amid a robust U.S. economy, which could be a drag on cryptocurrencies as liquidity conditions are said to affect speculative demand for digital tokens.
Trump has promised to create a friendly regulatory framework for digital assets, create a strategic bitcoin reserve and make the US the global center of the industry. A former skeptic of cryptocurrencies, the president-elect changed tack after digital asset companies spent heavily on the campaign trail to promote their interests, the paper said.
Cryptocurrency legislation could be approved soon under the Trump administration, helping to shift from enforcement-based regulation to a more collaborative approach, JPMorgan Chase & Co. strategists wrote in a note. headed by Nikolaos Panigirtsoglu.
Banks could get more opportunities to interact with digital assets, the team said, and markets are more hopeful about the approval of cryptocurrency exchange-traded funds that invest in tokens in addition to the two main ones, Bitcoin and Ether.
Regulatory clarity will be a tailwind for venture capital investments, mergers and acquisitions and initial public offerings, strategists say. But the creation of a U.S. bitcoin reserve is a “low-probability event,” they added.
U.S. spot bitcoin ETFs attracted net inflows of $4.7 billion from Nov. 6 to Nov. 13, a day when the original cryptocurrency hit an all-time high of $93,462, data compiled by Bloomberg show. About $771 million came out of the products on Thursday and Friday, leaving the group with total assets of $95 billion.
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