Against the backdrop of the recent victory of Donald Trump in the U.S. presidential election, the cryptocurrency market and, in particular, bitcoin, showed rapid growth - its value has already reached 89 thousand dollars per coin. UNN asked fintech expert and co-founder of Ukraine's first fintech ecosystem Concord Fintech Solutions Elena Sosiedka, whether this is due to the political situation in America and what else investors should expect. She also talked about why cryptocurrencies react to important political events and what consequences to expect from Trump's rise to power.
- Bitcoin has been on a record growth lately. Many attribute this to Donald Trump's victory in the US presidential election. Can this cryptocurrency really be so influenced by the political agenda in America?
- Bitcoin and other cryptocurrencies are indeed affected by political events, especially in countries with large economies like the United States. The perception of bitcoin as an alternative asset increases in times of political instability, so important political events, such as election results or statements by politicians, can have an impact on its price. However, the cryptocurrency market remains complex and multi-layered, and the bitcoin exchange rate is influenced not only by the political but also by the economic situation, such as the decisions of the Federal Reserve (Fed - ed.), macroeconomic indicators and global inflation.
I have previously toldthat Donald Trump's support for the crypto industry has created optimism in the market, which has attracted both private and institutional investors. Many major players began to buy bitcoin, and this caused its value to rise and "pulled" other cryptocurrencies along with it. In addition to cryptocurrencies, global financial markets also reacted to Trump's victory. They have also demonstrated rapid growth.
- If bitcoin did rise in value on the back of Trump's victory, can we expect to see even more growth in this currency by Trump's inauguration, which will take place on January 20?
- Assuming bitcoin did strengthen amid news of Trump's victory, the gains could continue until his inauguration. Investors may react to expectations of potential policies, especially if they focus on economic stimulus or contribute to a decline in confidence in traditional financial institutions.
- Could the currency fall after Trump takes office and reveals his domestic and foreign policy direction?
- Indeed, there is a possibility of a correction in bitcoin's value after Trump officially takes office and starts implementing his policies. If his policies strengthen the dollar or reduce risks to the traditional economy, this could weaken bitcoin's position, as some investors may leave for more stable assets.
- Why does the cryptocurrency industry have high hopes for Trump?
- Many participants in the crypto market associate expectations with the future president, who can be perceived as an adherent of deregulation (deregulation of the cryptocurrency market – ed.), which will reduce pressure on cryptocurrencies and make them more accessible. His policy may also cause bitcoin to grow if it is accompanied by an increase in government spending or provokes inflationary risks.
- Tell us what role US technology company MicroStrategy, led by Michael Saylor, is playing in bitcoin's growth?
((Sailor on X (Twitter) expressed support for bitcoin, and also reportedthat as of November 10, MicroStrategy acquired an additional 27,200 BTC for $2.03 billion)
- MicroStrategy and its CEO Michael Saylor have played a significant role in increasing confidence in bitcoin. Saylor was one of the first major executives to make bitcoin an important asset for his company, and this has sent a positive signal to other institutional investors. MicroStrategy's actions increase confidence in bitcoin as a long-term asset, which boosts its exchange rate.
- Is it true that Sailor's bitcoin bets can also raise or lower the value of bitcoin?
- Yes, Michael Saylor's actions, especially his large purchases, have a direct impact on the exchange rate. His statements or transactions can lead to price fluctuations, as his figure is associated with institutional support for bitcoin.
- Do you see an upper limit to the bitcoin price? Or could it still surprise everyone?
- Predicting the maximum price is difficult because bitcoin is tied to supply and demand, which are constantly changing. If the trend towards institutional investment continues and its role as “digital gold” strengthens, the price could rise significantly above current levels.
- Your professional advice: to buy or not to buy bitcoin now?
- The decision to purchase depends on personal goals and acceptable risk. If the goal is a long-term investment with a high degree of risk, bitcoin may be interesting. However, bitcoin's volatility requires a careful approach and it is best to consult with a financial expert.
- Will Trump's victory affect other cryptocurrencies - leaders : Ethereum, BNB, Litecoin?
- Yes, Trump's victory can have an impact not only on bitcoin, but also on other major cryptocurrencies such as Ethereum, BNB, Litecoin, as interest in cryptocurrencies often increases in a complex way.
Recall
UNN published a series of publications, in which we talked about digital currencies and their possibilities. Our first material was devoted to the technology underlying cryptocurrency - blockchain: Crypto for Dummies. Part 1: What is blockchain and its “tricks” that few people know about.
The second material is halving bitcoin: Crypto for Dummies. Part 2: What halving is, and why it's causing a stir in the cryptocurrency market.
The third material: "Crypt for dummies". Part 3: step-by-step instructions on how to buy a crypto coin.
The fourth material: "Crypt for dummies". Part 4: What are coins and tokens and what are their differences.
Fifth material: “Crypto for Dummies”. Part 5. Cold and hot wallets
The sixth material: Crypt for dummies. Part 6. Security when using cryptocurrency exchanges and exchangers