Bitcoin Hits Record $106,000 as Trump Proposes U.S. Crypto Reserve
Bitcoin surged to an all-time high above $106,000 on Monday after President-elect Donald Trump hinted at plans to establish a U.S. bitcoin strategic reserve similar to the country’s oil reserve. This announcement energized cryptocurrency enthusiasts, pushing the world’s largest cryptocurrency to a peak of $106,533 before settling at $104,462, up 3.2%. Meanwhile, smaller cryptocurrency ether gained 1.5%, trading at $3,965.
“We’re in uncharted territory now,” said Tony Sycamore, an analyst at IG. “The next target for the market is $110,000. The anticipated pullback never materialized, thanks to this recent news.”
The rally was further boosted by news of MicroStrategy’s inclusion in the tech-heavy Nasdaq 100 index, a move likely to attract additional investments for the software company known for its substantial bitcoin holdings.
Trump’s Pro-Crypto Stance
The crypto market has gained significant momentum since Trump’s election victory on November 5, driven by expectations of a more favorable regulatory environment under his administration. Bitcoin has already climbed 192% this year, with investors betting on Trump’s commitment to boosting the U.S.’s position in the cryptocurrency space.
Speaking to CNBC last week, Trump stated, “We’re going to do something great with crypto because we don’t want China or anyone else—it’s not just China but others—to lead in this area. We want to be at the forefront.”
When asked about creating a bitcoin reserve similar to the strategic oil reserves, Trump replied, “Yeah, I think so.”
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Global Crypto Reserves and Geopolitical Implications
Governments worldwide currently hold approximately 2.2% of bitcoin’s total supply, according to CoinGecko, with the U.S. alone possessing nearly 200,000 bitcoins worth over $20 billion. Other notable holders include China, the UK, Bhutan, and El Salvador, per BitcoinTreasuries data.
Countries like Russia have also shown interest in creating cryptocurrency reserves. Earlier this month, Russian President Vladimir Putin criticized the U.S. for using the dollar for political purposes, prompting many nations to consider alternative assets like bitcoin. “Who can prohibit bitcoin? No one,” Putin stated.
Skepticism and Caution
Despite the excitement, some analysts urged caution. Federal Reserve Chair Jerome Powell recently compared bitcoin to gold, emphasizing its speculative nature. Chris Weston, head of research at Pepperstone, noted that while Trump’s comments provide a short-term boost, implementing a bitcoin reserve would require careful planning and carry significant consequences.
“We need to remain cautious about the likelihood of a BTC strategic reserve being introduced anytime soon,” Weston said. “Trump’s statements may provide a tailwind for the market, but the long-term implications must be carefully managed and communicated.”
Crypto Market Growth and MicroStrategy’s Role
The broader cryptocurrency market has seen explosive growth, nearly doubling in value this year to exceed $3.8 trillion, according to CoinGecko. Trump, who once dismissed cryptocurrencies as a scam, adopted a pro-crypto stance during his campaign, vowing to make the U.S. the “crypto capital of the planet.”
He has also taken steps to appoint pro-crypto figures to key positions, naming former PayPal executive David Sacks as the White House czar for artificial intelligence and cryptocurrencies, and Washington attorney Paul Atkins as his pick to lead the Securities and Exchange Commission.
MicroStrategy, the largest corporate bitcoin holder, has been a key beneficiary of the crypto rally. Its shares have risen over six-fold this year, pushing its market value to nearly $94 billion. The company’s recent inclusion in the Nasdaq 100 Index is expected to drive additional inflows, which analysts predict CEO Michael Saylor will use to purchase more bitcoin.
With Trump’s proposed policies and growing institutional adoption, the crypto market is bracing for further gains as it moves into uncharted territory.
