Bitcoin rose to a new record ahead of Donald Trump’s inauguration for his second term as US president, reaching $109,000 before settling around $108,214 – up 6.5 percent.
The surge in the popular cryptocurrency reflects investor optimism that Trump’s new administration will take a more favorable stance toward digital assets.
The so-called “Trump effect” has fueled hopes that the president will use executive powers to reduce regulatory burden on crypto companies and help integrate digital currencies into mainstream financial markets. Trump, who initially had doubts about cryptocurrencies, has reversed course with a promise to make America “the crypto capital of the planet” and create a “strategic reserve” of bitcoin.
According to reports, Trump may sign an executive order in the early days of his presidency that would create a “crypto advisory board,” an idea he floated in July. He is also expected to fire Gary Gensler, chairman of the Securities and Exchange Commission, who has led the clampdown on the crypto industry; Gensler will resign on Monday ahead of his dismissal.
Over the weekend, Trump launched the “meme coin” $Trump, while his wife, Melania, introduced her own token, $Melania. The couple also started World Liberty Financial, a family-owned business that trades cryptocurrencies.
The promise of a crypto-focused White House also helped lift traditional markets: the FTSE 100 rose 0.14 percent to reach 8,518.12, while sterling strengthened 0.18 percent against the dollar at $1.2197 . Investors believe that Trump’s flurry of executive orders – possibly as many as 200 on his first day – will help boost both the digital currency and stock markets.
Bitcoin has come a long way since its inception in 2008. Once worth almost nothing, it traded at $7,333 five years ago. It surpassed the $100,000 mark early last month, further fueled by expectations that the Trump administration would help bring cryptocurrencies into the financial mainstream.