On Tuesday, bitcoin continued to grow, temporarily reaching record levels amid optimism about the possible creation of a Strategic Bitcoin Reserve, UNN reports with reference to Investing.
As of 09:06 ET, bitcoin was up 3.5%, reaching $107,380, slightly below the all-time high of $107,822 recorded the day before.
The latest growth is related to Trump's statement in an interview with CNBC, where he raised the prospect of creating a government reserve of bitcoin similar to the US Strategic Petroleum Reserve. He also promised favorable conditions for the development of cryptocurrencies if he wins the election.
Nevertheless, analysts remain skeptical about the creation of such a reserve. In particular, Compass Point notes that the creation of the reserve will require the approval of Congress, where Republicans, although they have a majority, have a high budget deficit that limits the possibility of additional spending. It is also noted that even if the reserve is created by executive order, it could be canceled by subsequent administrations.
The U.S. Department of Justice currently owns approximately 200,000 bitcoins confiscated from criminals, which could potentially form the basis for the reserve, but the mechanism for implementing such a step remains unclear.
The market for other cryptocurrencies showed more restrained optimism compared to bitcoin. Thus, Ether rose by 2.5% to $4,007.71, approaching the highs of 2021, and XRP jumped by 11% to $2.64. Solana and Cardano added over 3%, while Polygon remained unchanged. Among the meme tokens, Dogecoin gained 2.8%.
Traders are closely watching the Fed meeting on Wednesday, where the rate is expected to be cut by 25 basis points. However, special attention will be focused on the central bank's future interest rate forecasts. If the Fed signals a slower pace of easing in 2025, it could keep rates high for longer, potentially having a negative impact on bitcoin and other cryptocurrencies.
Recall
Bitcoin climbed to a record high above $106,000 on Monday after US President-elect Donald Trump said he plans to create a US strategic bitcoin reserve similar to the strategic oil reserve, which fueled the enthusiasm of crypto market players