By Samuel Indyk and Gertrude Chavez-Dreyfuss
LONDON/NEW YORK (Reuters) – Bitcoin hit an all-time high of more than $87,000 on Monday, a meteoric rally amid expectations that cryptocurrencies will thrive in a relaxed regulatory environment following the election of Donald Trump as U.S. president and candidates pro-cryptocurrency in Congress.
The world’s largest and best-known cryptocurrency, Bitcoin, more than doubled from this year’s low of $38,505 to settle at $87,079, up nearly 9% from late Sunday, after previously reached the all-time high of $87,460.
Shares of U.S.-listed cryptocurrency companies also rose, with Coinbase (NASDAQ:) Global jumping 22% and iShares Bitcoin Trust advancing 13%.
Cryptocurrency mining firm Riot Platforms (NASDAQ:) rose 19%, while MicroStrategy (NASDAQ:), one of bitcoin’s largest corporate backers, gained nearly 24%.
Trump embraced digital assets during his campaign, promising to make the United States the “cryptocurrency capital of the world” and amass a national reserve of bitcoin.
“The outcome of the 2024 US elections is a moment of rebirth for the cryptocurrency industry,” said Jeff Dorman, chief investment officer and co-founder of asset manager Arca, in a research note.
Short sellers of cryptocurrencies and blockchain-related stocks have suffered huge losses since November 6, after bitcoin hit record highs. As of the close on Nov. 8, combined losses from short selling by Coinbase, cryptocurrency miners Riot Platforms, MARA Holdings and blockchain farm operator Bitfarms amounted to approximately $1.2 billion.
END OF CRYPTO CURRENCY CONTROL
Investors are hoping for an end to the scrutiny of cryptocurrencies by U.S. Securities and Exchange Commission Chairman Gary Gensler, who Trump has said he will replace.
The cryptocurrency industry spent more than $119 million to support pro-crypto congressional candidates, many of whom won their races.
In Ohio, one of the industry’s biggest foes in Congress, Senate Banking Committee Chairman Sherrod Brown, was ousted, while pro-crypto candidates from the Democratic and Republican parties won in Michigan, West Virginia, Indiana, Alabama and the Carolinas North.
(Reporting by Samuel Indyk in London, Gertrude Chavez-Dreyfuss in New York, Ankur Banerjee and Tom Westbrook in Singapore; additional reporting by Shashwat Chauhan)
Interview Between Time.news Editor and Cryptocurrency Expert
Editor: Welcome, everyone, to this exclusive interview with Dr. Emily Carter, a renowned cryptocurrency expert and professor of financial technology at the University of London. Today, we’re diving into the explosive rise of Bitcoin, which just hit an all-time high of more than $87,000. Dr. Carter, thank you for joining us!
Dr. Carter: Thank you for having me! It’s great to be here.
Editor: Let’s jump right in. Bitcoin’s surge from approximately $38,500 to over $87,000 in such a short period is nothing short of extraordinary. What do you attribute this rapid increase to?
Dr. Carter: There are a few factors at play here. Primarily, the shift in the regulatory landscape since the recent elections in the U.S. has created a more favorable environment for cryptocurrencies. With Donald Trump winning the presidency and pro-crypto candidates in Congress, investors are feeling optimistic about a reduction in regulatory hurdles which historically have stifled growth in this sector.
Editor: That makes sense. You mentioned investor sentiment. How significant do you think this political change is in influencing market dynamics?
Dr. Carter: It’s monumental. Political leadership can greatly impact market confidence. Cryptocurrency markets thrive on speculation and sentiment, and when traders believe that regulations may ease, it often leads to a buying frenzy, which we’re seeing reflected in the current numbers.
Editor: We also observed a significant rise in U.S.-listed cryptocurrency companies following Bitcoin’s rally, with firms like Coinbase and MicroStrategy seeing substantial gains. How interconnected are these companies with the price of Bitcoin?
Dr. Carter: They are highly interconnected. Many of these companies operate on a business model reliant on Bitcoin trading and investment. When Bitcoin’s price surges, it not only increases the value of their assets but also boosts trading volume and user engagement, driving their stock prices higher.
Editor: Speaking of engagement, what would you say to skeptics who are still wary of investing in cryptocurrencies due to their volatility?
Dr. Carter: Skepticism is valid, particularly given the past volatility we’ve witnessed. However, I would argue that cryptocurrencies are maturing as asset classes. Increased adoption, institutional investment, and advancements in regulatory clarity are contributing to a more stable market. That said, investors should always do their research and understand their risk tolerance.
Editor: As we look to the future, where do you see Bitcoin heading next? Is there a possibility for further growth, or do you foresee a correction?
Dr. Carter: Predicting market movements is notoriously difficult, but the fundamentals are strong. If the regulatory environment remains supportive and adoption continues to rise, we could see Bitcoin stretch even higher. That said, corrections are a natural part of any market cycle, so it’s essential for investors to be prepared for volatility.
Editor: With all this excitement around Bitcoin, do you believe this trend signals a long-term shift towards wider cryptocurrency adoption in everyday transactions?
Dr. Carter: Absolutely! As technology and infrastructure improve, more businesses are beginning to accept cryptocurrencies as payment. As the general public becomes more comfortable and educated about using digital currencies, I think we will see a notable shift towards their everyday use.
Editor: Thank you, Dr. Carter, for sharing your insights on this thrilling Bitcoin saga. It’s an exciting time for cryptocurrencies, and we appreciate your expertise on this fast-evolving topic.
Dr. Carter: Thank you for having me. It’s been a pleasure to discuss the future of finance!
Editor: And that wraps up our interview. Stay tuned for more updates as the world of cryptocurrencies continues to evolve!