In recent weeks, the main cryptocurrency went through a lot of volatility, reaching about $ 42,000 before retreating. Crypto industry experts have identified the $ 40,000 level as a crucial brand that needs to be released by Bitcoin if he wants to continue his bullish trajectory.
New presidential shift triggers BTC fall
While some speculated that Bitcoin will undoubtedly reach new heights, supported by a wave of institutional investors who tout cryptocurrency as an ideal inflation protection, others speculated that Bitcoin was captured in bubble territory, echoing a déjà vu representative of the collapse of 2017. Bitcoin is currently trading at $ 31,857.38 at CoinMarketCap at the time of this writing, and has fallen by more than 15% in the last 7 days.
Bitcoin will continue to experience volatility, according to market experts. The fact that Joe Biden and Vice President Kamala Harris have been officially sworn in will keep Bitcoin fluctuations going. Jesse Cohen, a senior market analyst, told Express UK:
“While many expect Bitcoin to rise in 2021, I am more concerned with what the Biden administration might mean for crypts. I expect Bitcoin to remain highly volatile on the downside in the new year, given the potential for further scrutiny and stricter regulation. ”
What does Biden’s presidency mean for cryptocurrency?
Many have speculated whether Joe Biden’s presidency will benefit the cryptocurrency industry. While some fear this will result in tightening crypto regulations, others have been more hopeful, betting on the fact that the Biden government will be more benevolent than the Trump administration.
Currently, Biden’s inauguration day has been marked by a flood of executive actions, a total of 17, to undo what President Donald Trump has approved.
Although newly appointed President Biden did not make explicit comments about cryptocurrencies during his election campaign, several actions he has now taken have been warmly welcomed by the crypto community.
To begin with, Biden appointed Gary Gensler, a blockchain expert and former CFTC chairman, to replace Jay Clayton as chairman of the United States Securities and Exchange Commission (SEC). In addition, Michael Barr, a former member of the Board of Directors, was chosen to be the next Currency Controller.
However, the nominated Treasury Secretary, Janet Yellen, may not be as receptive to cryptocurrencies, having publicly said that cryptocurrencies were often used for illicit activities. She referred to the alleged use of Bitcoin to support certain anarchists involved in the Capitol riot as an example.
Why Bitcoin is set to appreciate after all
Despite the drop in the price of Bitcoin at the moment, the cryptocurrency is likely to appreciate and grow ahead, especially with stimulus measures worth $ 1.9 trillion to ease the economic turmoil caused by the coronavirus. With the Federal Reserve’s money printing machine set to work once again, the U.S. dollar will devalue, potentially causing new investors to migrate to Bitcoin as a reserve asset.
Many Bitcoin bulls saw the COVID-19 relief stimulus packages as an easy monetary situation that boosted demand for Bitcoin.