Policy-driven: Trump's crypto-friendly stance
Bitcoin's recent strong performance has a lot to do with US President-elect Donald Trump's friendly attitude towards cryptocurrencies. Since Trump won the presidential election on November 5, the price of Bitcoin has risen by more than 50%. The Trump administration intends to overturn the Biden administration's previous regulatory measures on the digital asset industry, and has also expressed support for Bitcoin as a national strategic reserve asset.
Strike founder and CEO Jack Mallers revealed that Trump may sign an executive order on his first day in office on January 20 to designate Bitcoin as a reserve asset. Although the reserve size may not be large at the beginning, this move is significant for the market. In addition, Dennis Porter, CEO of the Satoshi Action Fund, also said that at least three states, including Texas and Pennsylvania, are now preparing Bitcoin reserve bills, and 10 states may follow suit in the future. These positive policy trends provide strong support for Bitcoin prices.
Moreover, the market generally expects that the Federal Reserve will cut interest rates soon, which also creates a more relaxed macro environment for Bitcoin's rise. Financial analysts expect the Federal Reserve to announce a 0.25% interest rate cut on December 18. Interest rate cuts usually drive up the prices of risky assets, and Bitcoin, as "digital gold", is likely to become a key asset chased by funds.
