Bitcoin has broken out of its ascending channel
Support below: 92500, 87500
Now is a bull market, don't short if you are bearish. Buy in batches.
There are probably multiple reasons why Trump wants Bitcoin to become a reserve currency. Here is a detailed analysis of those reasons:
1. Bitcoin’s characteristics and potential advantages
1. Decentralization and non-sovereignty: Bitcoin is a decentralized digital currency that is not directly controlled by any government or central bank. This feature makes Bitcoin a potential reserve asset that can operate independently of the traditional financial system. Trump may believe that including Bitcoin in the strategic reserve can enhance the flexibility and independence of the US financial system.
2. Limited Supply: The supply of Bitcoin is limited, capped at 21 million. This limitation gives Bitcoin anti-inflationary characteristics, as its supply does not increase even during economic expansion. Trump may believe that this characteristic helps alleviate the United States' national debt and inflation pressures.
2. Political and Economic Considerations
1. Shift in Financial Policy: Incorporating Bitcoin into strategic reserves could represent a significant shift in U.S. financial policy. Trump may wish to highlight America's financial and technological advantages through this initiative and hopes to seize the opportunity to lead the global cryptocurrency development trend.
2. Alleviating National Debt Pressure: The limited supply and potential appreciation of Bitcoin may help the U.S. alleviate national debt pressures. If Bitcoin continues to appreciate, its limited supply could assist the U.S. in raising funds by selling Bitcoin, thereby easing the national debt burden.
3. Promoting the Development of the Cryptocurrency Industry: Trump may aim to promote the development of the U.S. cryptocurrency industry by supporting Bitcoin as a reserve currency. This would help the U.S. establish a leading position in the global cryptocurrency market and may bring economic benefits.
3. Trump's Personal Economic Goals
Economic Diversification and Reducing Dependence on Traditional Financial Systems: Trump may seek to achieve economic diversification and reduce dependence on traditional financial systems by promoting the development of cryptocurrencies like Bitcoin. This would help enhance the resilience and stability of the U.S. economy.
However, Trump's idea faces numerous challenges and controversies. The volatility of Bitcoin and the uncertainty of the legal and regulatory environment raise questions about its feasibility as a reserve currency. Additionally, incorporating Bitcoin into strategic reserves would need to overcome legal, security, and custody issues and may encounter resistance from central banks. Therefore, whether Trump's idea can be realized requires further observation and analysis.
