Bitcoin surpasses $106,000 on hopes of strategic reserves By Reuters

By Kevin Buckland and Ankur Banerjee

(Reuters) -Bitcoin rose to an all-time high above $106,000 on Monday after President-elect Donald Trump suggested he plans to create a strategic reserve of bitcoin in the United States similar to its strategic oil reserve, stoking enthusiasm for cryptocurrency bulls.

the world’s largest and most well-known cryptocurrency, peaked at $106,533 and was last trading up 3.2% at $104,462. The smallest crypto ether rose 1.5% to $3,965.

“We’re in blue sky territory here,” said IG analyst Tony Sycamore. “The next figure the market will look for is $110,000. The pullback that many people were expecting simply didn’t happen, because now we have this news.”

Investor sentiment was also boosted by MicroStrategy’s inclusion in the technology sector, which will likely generate more inflows for the software company turned bitcoin buyer.

Bitcoin and cryptocurrencies have catapulted into the spotlight as investors bet that the incoming Trump administration will usher in a friendlier regulatory environment, boosting sentiment around the altcoin. Bitcoin is up 192% on the year.

“We’re going to do something great with cryptocurrencies because we don’t want China or anyone else (not just China but others adopting it) and we want to be the head of it,” Trump told CNBC late last week.

When asked if he plans to build a crypto reserve similar to oil reserves, Trump said: “Yes, I think so.”

Governments around the world held 2.2% of the total bitcoin supply in July, according to data provider CoinGecko, and the United States holds nearly 200,000 bitcoins valued at more than $20 billion at current levels.

China, the United Kingdom, Bhutan and El Salvador are other countries with significant amounts of bitcoins, data site BitcoinTreasuries showed.

Other countries have also been considering strategic cryptocurrency reserves.

Russian President Vladimir Putin said earlier this month that the current US administration was undermining the US dollar’s role as a reserve currency in the global economy by using it for political purposes, forcing many countries to turn to alternative assets. , including cryptocurrencies.

“For example, bitcoin, who can ban it? Nobody,” Putin said.

There are skeptics, however: Federal Reserve Chairman Jerome Powell compared bitcoin to gold earlier this month. Analysts also point out that implementing any such measure will take time.

“I think we still need to be cautious about the strategic BTC reserve, and at least consider that this won’t happen anytime soon,” said Chris Weston, head of research at Pepperstone.

“Of course, any comments from Trump that offer a greater degree of hope that plans for a strategic reserve are evolving are an obvious tailwind, but this would bring consequences that would need to be carefully considered and well telegraphed to market players.” .

CRYPTOGRAPHY BOOST

Bitcoin has risen more than 50% since the November 5 election in which Trump was elected along with many other pro-crypto candidates. According to CoinGecko, the total value of the cryptocurrency market has nearly doubled so far this year to reach a record high of more than $3.8 trillion.

Trump, who once called cryptocurrencies a scam, embraced digital assets during his campaign and promised to make the United States the “crypto capital of the planet.”

Trump this month named a White House czar for artificial intelligence and cryptocurrencies, former PayPal (NASDAQ) executive David Sacks, a close friend of Trump adviser and mega-donor Elon Musk.

Trump also said he would nominate pro-cryptocurrency Washington attorney Paul Atkins to head the Securities and Exchange Commission.

On Friday, exchange operator Nasdaq said MicroStrategy will be added to the Nasdaq-100 index and that the change will take effect before the market opens on December 23.

MicroStrategy, an aggressive investor in the world’s largest crypto asset, has seen its shares increase more than sixfold this year, taking its market value to nearly $94 billion. It is now the largest corporate holder of the cryptocurrency.

Pepperstone’s Weston said the market was “advancing the idea that Michael Saylor (CEO of MicroStrategy) will capitalize on the likely rebound in MicroStrategy’s share price, given the imminent passive flows from its inclusion in the NAS100, where presumably “will sell shares and buy more bitcoins.”