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This is why crypto enthusiasts are cheering Trump's victory

Cryptocurrencies have surged in value since Donald Trump won the election in the USA and the Bitcoin price is for the first time up at 80,000 dollars. The President-elect has made a U-turn from critic to crypto friend. Now the industry is hoping for slightly less strict regulations, says Johan Javeus, economist at SEB.

» Updated: 10 November 2024, 14:53

» Published: 10 November 2024

This is why crypto enthusiasts are cheering Trump's victory
Photo: Mark Humphrey AP/TT

Five years ago, Donald Trump dismissed cryptocurrencies as an asset with a value "built on air". Ahead of this year's presidential election, it sounds different.

At a bitcoin event in Nashville last summer, Trump promised to fire the head of the US financial supervision, Gary Gensler, on his first day in the White House. Crypto companies have been scrutinized hard under Gensler's leadership.

During the election campaign, Trump and the crypto industry have had a fairly close collaboration. There is therefore a great enthusiasm now that the policy to be pursued will be relatively friendly towards this industry, says Johan Javeus, senior economist at SEB, who, among other things, follows the crypto industry.

New record levels

According to Javeus, there have also been relatively large donations to Trump's campaign from the crypto world. Elon Musk, one of Trump's largest donors, is also friendly towards crypto.

Donald Trump has also ventured into the industry himself, including by starting a new company that will trade in cryptocurrencies.

When it became clear that Trump won the election, the value of bitcoin and several other crypto assets therefore surged to new record levels. On Sunday, the price of one bitcoin reached 80,000 US dollars for the first time, equivalent to around 865,000 kronor.

Exactly what Trump's policy will entail in practice for cryptocurrencies is still too early to say, according to Javeus.

The industry hopes for a slightly less strict regulatory framework that can create growth opportunities that it does not think it has today.

Johan Javeus wants to emphasize that it is a very speculative market, where prices can quickly rise – and fall.

Great expectations

Emelie Moritz, CEO of the Swedish crypto platform Safello, has noticed an increased interest from both institutional investors and private savers in connection with the election.

But according to Moritz, there are also several other reasons for the high price of bitcoin than Trump's victory.

A global macro environment with lower interest rates is generally always positive for high-risk assets, she says.

The great expectations on Trump have been clear for a long time, according to Moritz.

We saw that also last summer during the assassination attempt on Trump. Then bitcoin went up 10 percent, as the market then believed that the chances of him being elected increased.

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By TTThis article has been altered and translated by Sweden Herald

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