As Bitcoin surged beyond $71,000 on Wednesday, the United States also seems to be reclaiming its dominance in the crypto markets, ahead of the much anticipated U.S presidential elections.
Experts analyze that the top leadership of U.S. is driven by record-breaking Bitcoin ETFs, supportive regulators, increasing political donations, and the rising prominence of crypto advocate Donald Trump.
This resurgence is evident in various indicators, particularly the US dollar’s return as the most-traded currency against crypto assets, overtaking the South Korean WON in early May, according to research firm Kaiko.
This marks a significant shift from last year when trading volumes shifted to Asia due to strict enforcement actions by US regulators. The Securities and Exchange Commission, after targeting companies like Binance and Coinbase Global Inc. in 2023, surprised the market in late May by approving exchange-traded funds (ETFs) investing in Ether.
Trump holds a narrow lead over President Joe Biden in current polls, according to Morning Consult data. Meanwhile, the Financial Innovation and Technology for the 21st Century Act, which aims to establish a new regulatory framework for cryptocurrencies in the US, has a higher chance of becoming law in 2025, as noted by Bloomberg Intelligence analysts.
The political shift in favor of crypto began on January 11 with the introduction of spot Bitcoin ETFs from BlackRock Inc. and Fidelity Investments. These ETFs have accumulated $61 billion in assets, making them one of the most successful fund category launches ever.
Mike Novogratz, CEO of Galaxy Digital, predicted that a favorable US political climate could push Bitcoin’s price above $100,000 by the end of the year. As of Wednesday afternoon in Singapore, Bitcoin was trading at $71,130.
According to Galaxy Digital, the US hosts 324 crypto-focused venture capital firms, far outnumbering the 66 in second-place Singapore. Pantera Capital and Paradigm, two major US investment firms, are raising significant new funds, highlighting the US’s strong position in the crypto market.
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