Bitcoin hit a record high on Wednesday morning as it looked increasingly likely that Donald Trump would take the White House.
The cryptocurrency hit a new peak of $75,273.47, soaring past the $75,000 mark for the first time as Trump took the lead in the presidential race.
With the Trump victory confirmed, bitcoin has slipped back from its peak, but is trading up more than 6.31 per cent at $73,759.29 as of midday on Wednesday.
New president: Donald Trump has claimed victory in the US election, promising to reduce regulation in the crypto space
The currency has largely been trading below the $70,000 mark so far this year, having last fallen below this point in June before posting large enough gains last week.
Donald Trump has long supported a decentralised approach to cryptocurrencies, meaning less restriction on the market.
As a result, crypto investors are hopeful of new policy favourable to the crypto space.
Trump jump: Bitcoin hit a new record high in the early hours of the morning, passing the $75,000 mark
Simon Peters, market analyst at Etoro, told This is Money: ‘Although both candidates expressed support for the US crypto industry, Trump was more vocal and convincing during his campaign, even going so far as to headline Bitcoin 2024 in July, becoming the first US president, current or former, to speak at a crypto conference.
‘With a “clean-sweep”, presidency and congress, the initiatives proposed by Trump during his campaign to boost the US crypto industry could face fewer roadblocks and be far easier to push through.’
One such initiative is to sack crypto regulator Gary Gensler, which Trump has promised to do ‘on day one’ of his presidency.
This, according to Glen Goodman, author of The Crypto Trader, ‘brought the audience to their feet, cheering and applauding.’
Goodman told This is Money: ‘Gary Gensler has been the bane of crypto businesses in America and across the world, bringing court cases against some of the biggest companies in the industry, such as Coinbase.
‘So firing Gary Gensler is number one on the crypto community wishlist. And that’s one of the main reason bitcoin’s price has been soaring today.’
The surge in bitcoin’s value comes as part of the ‘Trump trade’, with investors flocking to assets expected to perform well under a Trump presidency.
Other cryptocurrencies also jumped in value, with ethereum rising 8 per cent and dogecoin up 18 per cent.
Publicly listed crypto mining companies and crypto proxies have posted gains.
Bitcoin development company MicroStrategy is up almost nine per cent in pre-market trading.
Similarly, Trump Media rose 31 per cent in pre-market trading on the back of the election result, while Elon Musk’s Tesla rose 13 per cent.
With Bitcoin having hit a new record high, experts say it could be on the way to breaking further boundaries in coming weeks and months.
Joel Kruger, market strategist from LMAX Group, said: ‘Bitcoin has officially broken out to a fresh record high clearing the next major psychological barrier at $75,000.
‘As per our technical insights, this now opens the door for a push to $100,000 in the weeks ahead.
‘This will likely set the stage for an impressive wave of bullish momentum for crypto assets into year-end.’
Echoing this, Peters added: ‘With the previous all-time high now broken, the bitcoin price is now in price discovery and where we see a peak is anyone’s guess.’
Peters said the incoming interest rate decision from the Federal Reserve could also boost cryptocurrencies in the cases of the expected 25 basis point rate cut.
Is now the right time to buy bitcoin?
With Trump in the White House, the outlook for crypto looks more promising than in recent years.
Peters suggests that despite prices being at an all time high, it could be a good time to invest in bitcoin.
He said: ‘Looking back at previous presidential elections, the bitcoin price has never retraced below its election-day price after the results are in. Historically prices have gone parabolic after.
‘One such proposal that could act as a massive tailwind for the bitcoin price is if the US adopts bitcoin as a strategic reserve asset.
‘With a limited supply of bitcoin available to buy, other countries and nations may also move sooner to adopting their own bitcoin treasury strategy for fear of missing out.’
On top of this, inflation rates in developed countries are beginning to fall back to target levels, which could provide a positive environment for the crypto market.
Goodman said: ‘Bitcoin’s price has so far moved in four-year cycles and we’re now entering the third year, where the price tends to rocket. With Trump’s election, all the pieces are in place for a big rally in the coming months.
‘Of course nothing’s inevitable and once the honeymoon’s over, if Trump’s crypto policies prove disappointing, an upward price move is not guaranteed. But so far, it’s looking promising.’
With crypto investing considered high risk, Peters says investors should only commit what they can afford, with crypto assets only forming a small part of their portfolios.
He said: ‘Finally, rather than going “all-in” with a planned investment and buying at one price level, dollar-cost averaging – i.e investing small amounts at regular intervals – takes away some of the timing risk and maybe a better approach for investing.’
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