Bitcoin hits $80,000. Why Trump is boosting crypto

CNN
—

Bitcoin hit a new record of over $80,000 on Sunday. The world's largest cryptocurrency rose sharply ahead of Tuesday's US presidential election, rose sharply on election night after it became clear that Donald Trump would win, and continued to rise in the days since his victory.

Bitcoin is up 80% this year, dwarfing the S&P 500's still-electric gain of 25.7% this year. After briefly hitting $80,000, Bitcoin was trading just below that on Sunday morning.

The crypto industry believes Trump's victory is a positive sign for Bitcoin and other digital currencies. Although Trump was once a Bitcoin skeptic, once saying it was “based on thin air,” he has fully embraced the cryptocurrency in recent months – unlike the Biden administration, which has tried to rein in the cryptocurrency.

A big reason why Trump has changed his stance on cryptocurrencies: He now has a financial stake in it. In September, Trump and his children founded a new crypto company called World Liberty Financial.

“It’s very young and growing a lot,” Trump said of the cryptocurrency industry on September 16 when he introduced World Liberty Financial. “I believe in it.”

In contrast, the Biden administration is far more skeptical of cryptocurrencies. Gary Gensler, chairman of the Securities and Exchange Commission, said in June 2021 in one of his first speeches in his then-new job that cryptocurrencies are “rife with scams, scams and abuses.”

Gensler's SEC sued crypto companies and worked to regulate the industry, which the chairman said consisted at least in part of securities traded illegally. The SEC also worked with other regulators, including the Justice Department, to prosecute crypto fraudsters – most notably Sam Bankman-Fried, the infamous CEO of FTX.

Gensler moved slowly but eventually approved a Bitcoin exchange-traded fund that would allow people to gain more exposure to cryptocurrencies in their retirement accounts. In January 2024, Genslers

Trump said in August that cryptocurrencies could “determine the future,” adding that he wanted them to be “mined, minted and manufactured in the United States.” The president-elect also proposed a strategic national Bitcoin stockpile, similar to America's strategic petroleum reserve, that would involve directly purchasing and investing in cryptocurrencies as a national security measure.

Elon Musk, one of Trump's most visible and ardent supporters, is a notorious crypto bull. Musk's favorite coin, Dogecoin, rose more than 20% on Sunday and has already been surging over the past week.