NEW YORK (AP) After confidence in the banking system and Washington’s capacity to safeguard those who must engage in it had eroded, Bitcoin emerged from the ashes of the 2008 global financial crisis. Washington’s endorsement of bitcoin is now what’s driving its price down and filling the coffers of its supporters.
Following President-elect Donald Trump’s announcement that he plans to choose Paul Atkins, a former regulator who is perceived as being pro-crypto, as the next chair of the Securities and Exchange Commission, Bitcoin temporarily jumped above $103,000. Gary Gensler, who has been criticized for being unduly tough in his regulation of cryptocurrency, would be replaced by him.
It’s the most recent leg of an incredible surge for bitcoin, whose price swings are already infamously sharp.
This year, the price of Bitcoin has more than doubled, with a notable spike occurring after Election Day, when it was trading below $70,000. Trump advocated for the United States to become the global center of cryptocurrency during his campaign.
Meanwhile, the cryptocurrency business played a role in bringing pro-digital currency legislators to Washington. According to a recent Public Citizen study, cryptocurrency companies spent more than $119 million to influence federal elections in 2024, mostly through a political action committee that aimed to elect pro-crypto lawmakers and oppose crypto skeptics.
It’s a substantial sum. The consumer advocacy group claims that 44% of all corporate contributions made during this year’s elections were from cryptocurrency companies.
Such a strong embrace represents an intriguing turn from the early days of bitcoin, when a person or group of people going by the name of Satoshi Nakamoto developed a form of electronic money that was independent of all governments and financial institutions.
Namakoto stated in the white paper introducing bitcoin that the conventional method of conducting business online functions adequately for the majority of transactions. However, according to Nakamoto, it still has the fundamental flaws of the trust-based paradigm, which requires payment processing by a third party, such as a bank.
Rather, Nakamoto proposed utilizing global computing power to develop a digital currency that is non-refundable. An electronic payment system that relies on cryptographic proof rather than trust is required so that any two willing parties can conduct business with one another directly without the involvement of a third party they can trust. The bitcoin network was born out of that.
Since then, bitcoin has made erratic transitions from the financial edges to the mainstream. It gained appeal as a form of digital gold, or a way to hold value in something that is not directly influenced by a central bank or the federal government, even though it hasn’t taken off as a means of paying for groceries.
Early on, it was known for being used by drug dealers, con artists, cryptocurrency aficionados, libertarians, and others who wanted to transfer money without government supervision. More investor portfolios now contain it as well. The SEC authorized exchange-traded funds that follow the spot price of bitcoin earlier this year. With the help of these ETFs, investors may purchase bitcoin directly from their current trading accounts in a comparatively simple manner.
Bitcoin has experienced both dramatic drops during crypto winters and a succession of frenetic bull runs throughout its existence. Before plunging below $17,000 in the wake of the Federal Reserve’s interest rate hikes and the bankruptcy of cryptocurrency exchange FTX in 2022, it had risen from just over $5,000 at the beginning of the COVID-19 pandemic to almost $69,000 by the end of 2021.
The man set to take over the White House appeared to claim at least some of the credit for the recent surge in bitcoin prices.
BRAVO TO ALL BITCOINERS! Trump stated in a post on his network, Truth Social. One hundred thousand dollars! YOU’RE WELCOME!
The Associated Press, 2024. All rights reserved. All rights reserved. It is prohibited to publish, broadcast, rewrite, or redistribute this content without authorization.
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