Bitcoin Surpasses $82,000: Trump’s Election Sparks New Records

Trump’s Victory, Institutional Investor Interest, and Regulatory Clarity Drive Bitcoin to New Highs. The Italian Government Takes a Different Stance with Proposed Tax Increase.

Milan, November 11, 2024 - Bitcoin continues to break records, surpassing the $82,000 mark today for the first time. This milestone follows a remarkable year for the cryptocurrency, buoyed by Trump’s decisive win in the U.S. elections, macroeconomic factors like rate cuts, impressive inflows into ETFs authorized in January, and regulatory clarity from the U.S. and the European Union.

Bitcoin has grown over 95% since the beginning of the year, lifting the entire crypto sector (+69%) in which it remains the undisputed leader, solidifying itself as an essential investment for a diversified portfolio. Ferdinando Ametrano, CEO of CheckSig, comments: ”Bitcoin has proven to be the most rewarding asset class of 2024, 2023, and the past decade. Its lack of correlation with other asset classes improves the risk-return profile of a diversified portfolio. Following the success of ETFs launched in January, it became clear to observant analysts that, after Trump declared his support for Bitcoin in July, the $80,000-$85,000 threshold could be easily achieved by year-end.”

Bitcoin has seen cycles of explosive growth and significant retracements since its inception. ”These fluctuations reflect the natural value discovery process of an innovative asset, similar to the cycles experienced by Amazon in the late 90s early 00s during the dot-com bubble,” Ametrano explains. ”As with internet and e-commerce, Bitcoin’s volatility is linked to the adoption of an innovation poised to transform markets. Indeed, Bitcoin’s volatility is comparable to other high-performing stocks of the decade, like Amazon, Apple, Netflix, Nvidia, and Tesla.”

The Trump Effect and the U.S. Context

Trump’s recent victory in the U.S. presidential elections has been a crucial driver of Bitcoin’s recent rally. In the U.S., the crypto sector played a significant role in the election campaign. Trump promised to make the U.S. the “global capital of cryptocurrencies” and to create a long-term strategic Bitcoin reserve to help reduce national debt. He also expressed intentions to “fire” Gary Gensler, current SEC chairman, citing his overly restrictive approach to cryptocurrencies. A more favorable regulatory environment for institutional crypto adoption is now anticipated, which could stimulate further investments and new highs.

While some campaign promises may be hyperbolic, it’s likely that a few will be fulfilled. A significant signal from the new administration could come if Trump follows through with his promise to pardon Ross Ulbricht, the founder of Silk Road, the first online black market where Bitcoin was used as currency. Ulbricht, arrested in 2013, received a double life sentence plus 40 years—far more severe than the 55-year sentence given to Carlos, a Colombian cartel boss. Ametrano remarks, ”If, upon taking office in January, Trump keeps his promises, starting with a pardon for Ulbricht, it’s highly probable that Bitcoin will exceed $100,000 in 2025.”

The EU Embraces Bitcoin with MiCA Regulation

The European Union is also playing a pivotal role in strengthening Bitcoin’s position with the introduction of the MiCA (Markets in Crypto-Assets) regulation, a framework governing crypto operators in Europe. Many European operators are already offering or plan to offer Bitcoin services.

Michele Mandelli, managing partner of CheckSig, states, ”Institutional demand for crypto assets is on the rise. Bitcoin ETFs by BlackRock and Fidelity, launched in January, recently surpassed $38 billion in assets. It’s easy to imagine similar figures when the European market opens, expected within the next 12-24 months. With MiCA, hundreds of Italian and European operators will enter the crypto services market, thanks to a clear regulatory context. This is an opportunity to attract and retain new clients, and CheckSig is here to facilitate this transition.”

Italy’s Divergent Approach

Currently, Italy’s Parliament is debating the 2025 Budget Law, which proposes an increase in the capital gains tax on cryptocurrencies from the standard 26% applied to all financial activities to 42%. ”This measure is inequitable because it’s discriminatory, penalizing only direct investments in Bitcoin, while indirect investments through ETFs and derivatives remain taxed at 26%. It’s unconstitutional, given that the Italian Republic promotes and protects savings in all forms. Furthermore, the expected revenue is minimal—less than €17 million—so it’s likely to simply drive capital abroad,” Ametrano explains. ”It’s also politically inconsistent for a government that claims to avoid tax hikes but would target the 3.6 million Italians who have invested in crypto; a government that pledges to support young people: 60% of crypto investors are under 40; a government that says it wants to help businesses, yet would undermine the Italian crypto ecosystem. It’s a culturally incomprehensible proposal from a government that engages with BlackRock, boasts ties with Elon Musk, and celebrates Trump’s election.”

Bitcoin Is Here to Stay

Ametrano concludes, ”Bitcoin has shattered performance records, including ETF inflows, has futures and options traded on the Chicago Mercantile Exchange, and trades 24/7 with volumes that are multiple times those of Apple. Bitcoin is here to stay: excluding it from an investment portfolio would be an irrational forfeiture of a strategic advantage.”