Pre-Trump cheering lifts Bitcoin price above $100,000

WASHINGTON — Bitcoin topped $100,000 again early Friday, as the swelling cryptocurrency industry expects early action from Donald Trump when he is sworn in as president next week.

Trump was a skeptic who said a few years ago that Bitcoin “looks like a scam,” and he has embraced cryptocurrencies with gusto. He has started a new cryptocurrency venture and pledged during his campaign to take steps early in his presidency to turn the United States into the “crypto capital” of the world.

His promises include creating a US cryptocurrency reserve, enacting industry-friendly regulations, and appointing a cryptocurrency “czar” to manage it.

“You’re going to be very happy with me,” Trump told cryptocurrency enthusiasts at a Bitcoin conference last summer.

Bitcoin is the most popular cryptocurrency in the world and was created in 2009 as a type of electronic cash that is not controlled by banks or governments. They and newer forms of cryptocurrencies have moved from the financial fringes to the mainstream in fits and starts.

The highly volatile nature of cryptocurrencies, as well as their use by criminals, scammers and rogue states, have attracted many critics, who say that cryptocurrencies have limited utility and are often merely Ponzi schemes.

But cryptocurrencies have so far defied the naysayers and survived long price declines during their short lives. Wealthy players in the cryptocurrency industry, who felt unfairly targeted by the Biden administration, spent large sums of money to help Trump win the election last November. Bitcoin prices have risen since Trump’s victory, surpassing $100,000 for the first time last month before briefly falling to around $90,000 earlier this week. Two years ago, Bitcoin was worth around $20,000.

On Friday, Bitcoin rose nearly 5% to around $104,000 according to CoinDesk.

Trump’s picks for key Cabinet and regulatory positions are stacked with crypto supporters, including his pick to lead the Treasury and Commerce Departments, as well as Chairman of the Securities and Exchange Commission.

As a candidate, Trump promised that he would create a special advisory council tasked with providing guidance on creating “clear” and “direct” regulations related to cryptocurrencies within the first 100 days of his presidency.

Details regarding the council and its membership remain unclear, but after winning the November election, Trump appointed technology executive and venture capitalist David Sachs to serve as the administration’s cryptocurrency “czar.” Trump also announced in late December that former North Carolina congressional candidate Beau Haynes would serve as executive director of the Presidential Council of Advisors on Digital Assets.

At a Bitcoin conference last year, Trump told cryptocurrency supporters that new regulations “will be written by people who love your industry, not hate it.” Paul Atkins, Trump’s pick to lead the Securities and Exchange Commission, has been a vocal advocate for cryptocurrencies.

Cryptocurrency investors and companies have expressed anger at what they say is a hostile Biden administration that has overstepped its bounds with unfair enforcement actions and accounting policies that have stifled innovation in the industry — particularly at the hands of outgoing Securities and Exchange Commission Chairman Gary Gensler.

“In terms of public expectations from the Trump administration, I think one of the best things to bet on is a change in tone at the SEC,” said Peter Van Valkenburg, executive director of the advocacy group Coin Center.

Gensler, who is set to leave as Trump takes office, said in a recent interview with Bloomberg that he is proud of his office’s actions to police the cryptocurrency industry, which he said is “riddled with bad actors.”

Trump also promised that as president he would make sure the US government hoarded Bitcoin, like it already does with gold. At a bitcoin conference earlier this summer, Trump said the US government would keep, rather than auction off, billions of dollars in bitcoin it had seized through law enforcement actions.

Cryptocurrency advocates posted a draft of an executive order online that would create a “Bitcoin Strategic Reserve” as a “perpetual national asset” that the Treasury Department would manage through its Stock Exchange Stabilization Fund. The draft order calls for the Treasury Department to eventually hold at least $21 billion in bitcoin.

Republican Sen. Cynthia Lummis of Wyoming earlier proposed legislation that would require the U.S. government to store bitcoin, which supporters said would help diversify the government’s holdings and hedge against financial risks. Critics say Bitcoin’s volatility makes it a poor reserve.

Creating such a stock would also be “a giant step in the direction of normalizing bitcoin, legitimizing it in the eyes of people who don’t see it as legitimate yet,” said Zach Shapiro, a lawyer and head of policy at the bank. Bitcoin Policy Institute.