Donald Trump won the presidential election, and shortly afterwards, Senator Cynthia Loomis announced her support for the idea of creating a strategic reserve in bitcoin. Draft law «crypto queens» Capitol Hill BITCOIN from 2024 (Boosting Innovation, Technology, and Competitiveness through Optimized Investment Nationwide Act) proposes to purchase 1 million bitcoins within five years and create secure bitcoin vaults managed by the state treasury.
If the bill is passed, it will mean large-scale investments in cryptocurrencies by the US government, which will help to increase their popularity among institutional investors. Against the backdrop of these plans and given Trump’s previous statements on cryptocurrencies, bitcoin price updates record and reaches $76 thousand. This may not be the limit.
The planned reserve within BITCOIN will amount to about 5% of the total supply of bitcoins, which will give it the status of gold. Trump has frequently criticized the current chairman of the Securities and Exchange Commission (SEC), Gary Gensler, for his strict policy on digital assets. The Trump administration is likely to bring loyal regulators to these positions. This, coupled with the support of major crypto companies such as Coinbase, A16Z, and Ripple, could make it much easier to pass legislation in Congress in support of cryptocurrencies.
It is already known that the 47th President of the United States plans to involve Elon Musk in the implementation of initiatives to reduce government spending and public debt by $2 trillion. At the same time, monetary policy is planned to ease, which may increase market liquidity and increase the attractiveness of bitcoin as a hedge against inflation.
The next four years could be a period of significant institutional support, increased government interest, and widespread public acceptance of cryptocurrencies in general and bitcoin in particular.
Source: CoinShares Research Blog