Bitcoin hits record high above $106,000 amid Trump’s crypto reserve plans

On December 16, Bitcoin surged to an all-time high above $106,000 following President-elect Donald Trump's comments about creating a U.S. Bitcoin strategic reserve, similar to the nation's strategic oil reserve.

The announcement has fueled optimism among cryptocurrency enthusiasts, pushing Bitcoin and other digital assets into the spotlight, Caliber.Az reports, citing foreign media.

The world’s leading cryptocurrency, Bitcoin, hit a record high of $106,533 before settling at $104,462, up 3.2 per cent on the day. Ether, the second-largest cryptocurrency, climbed 1.5 per cent to $3,965.

Trump’s remarks, suggesting his administration may adopt a crypto-friendly regulatory stance, have boosted investor sentiment. Bitcoin’s value has soared by 192 per cent so far this year.

“We’re gonna do something great with crypto because we don’t want China or anybody else - not just China but others are embracing it - and we want to be the head,” Trump said during a CNBC interview last week.

When questioned about the possibility of creating a crypto reserve akin to the oil reserve, Trump confirmed, “Yeah, I think so.”

As of July, governments globally held 2.2 per cent of Bitcoin’s total supply, according to CoinGecko. The United States reportedly possesses nearly 200,000 bitcoins, valued at over $20 billion at current market rates. Other nations with significant Bitcoin holdings include China, the UK, Bhutan, and El Salvador, according to data from BitcoinTreasuries.

The idea of cryptocurrency strategic reserves is gaining traction internationally. Russian President Vladimir Putin recently criticized the U.S. for undermining the dollar’s role as a global reserve currency through political means, prompting nations to consider alternatives like cryptocurrencies.

“For example, bitcoin, who can prohibit it? No one,” Putin remarked earlier this month.

Despite the growing excitement, some analysts remain cautious. Federal Reserve Chair Jerome Powell likened Bitcoin to gold, signalling scepticism about its role in strategic reserves.

“I think we still need to be cautious on a BTC strategic reserve, and at least consider that this is not likely to happen anytime soon,” said Chris Weston, head of research at Pepperstone. He added, “Of course, any comment from Trump that offers an increased degree of hope that plans for a strategic reserve is evolving are an obvious tailwind, but this would come with consequences which would need to be carefully considered and well telegraphed to market players.”

Notably, Bitcoin’s meteoric rise has been particularly pronounced since the November 5 election that saw Trump and other pro-crypto candidates elected. The cryptocurrency market's total valuation has nearly doubled this year, surpassing $3.8 trillion, according to CoinGecko data.

Trump, who previously dismissed cryptocurrencies as a "scam," reversed his stance during his campaign, pledging to transform the U.S. into the “crypto capital of the planet.”

By Khagan Isayev