Bitcoin surged above $ 19,000 on Tuesday after Donald Trump announced his administration would support President-elect Joe Biden’s transition to the White House to allay investor concerns about an extended period of election uncertainty.
The BTC / USD exchange rate rose 3.89 percent to a new annual high of $ 19,100, indicating a prolonged uptrend towards its previously set record high near $ 20,000. BTC / USD-linked futures also rose 4.56 percent to $ 19,445, suggesting further growth for the pair in the spot market.
Bitcoin Futures on CME are 5% away from testing their all-time high. Source: BTCUSD on TradingView.com
Investors cheered as a protracted battle for control of the US Presidency drew near and the political risks that may have impacted markets were reduced. The head of general services administration said her office will assist Mr. Biden with the switch on Monday.
Meanwhile, Mr Trump also said that he had instructed his aides to do the same.
Joe Biden means bullish bitcoin
Bitcoin rebounded in the fourth quarter in anticipation of a clear win from Joe Biden. Many analysts predicted that a Democratic majority in the House of Representatives and Senate committee would pave the way for a generous coronavirus stimulus package. The growing budget deficit would in turn weaken the US dollar.
“We see the weakness of US economic data as that [current] The stimulus goes out. For me it’s all negative, ”Brown Brothers Harriman’s Win Thin warned in a CNBC interview on Monday.
The greenback is inversely correlated with Bitcoin, especially since the global market trend in March.
Bitcoin is on a climbing spree since March 2020. Source: BTCUSD on TradingView.com
Analysts expect more downward pressure on the US dollar as the Federal Reserve continues to buy government and corporate debt indefinitely. This is especially possible after the news that Mr. Biden plans to appoint former Federal Reserve chairwoman Janet Yallen as Secretary of the Treasury.
It could reactivate the Fed’s emergency loan programs that current Treasury Secretary Steven Mnuchin shut down last week. In the long run, this would mean lower bond yields, which in turn would lead investors to profitable alternatives like Bitcoin.
“[Yallen] has clearly shown that it is ready to minimize the downside risks to the economy, ”Eric Barthalon, global head of capital markets research at Allianz, told the WSJ. “This is good news from a markets perspective.”
Bitcoin showed signs of a modest downward correction at $ 19,000 at press time.