Bitcoin surged to a record high above $106,000 on Monday morning following comments from President-elect Donald Trump hinting at plans to create a U.S. bitcoin strategic reserve, akin to the country’s strategic oil reserve. The news sparked renewed enthusiasm among crypto investors.
The world’s largest cryptocurrency reached an all-time high of $106,533 before easing slightly to $104,462, up 3.2% for the day. Ethereum, the second-largest cryptocurrency, also saw gains, rising 1.5% to $3,965.
“We’re in uncharted territory now,” said Tony Sycamore, an analyst at IG. “The next target for the market will be $110,000. Many expected a pullback, but this news has kept the momentum strong.”
Investor optimism was further bolstered by the inclusion of MicroStrategy, a prominent bitcoin-holding software company, into the Nasdaq 100 index. The move is expected to attract additional investment into the firm and, by extension, the broader crypto market.
Bitcoin’s rally has been fueled by expectations that the Trump administration will adopt a more crypto-friendly regulatory stance, enhancing its appeal as an alternative asset. Bitcoin has gained an astonishing 192% so far this year.
Trump’s Comments Ignite Optimism
Speaking to CNBC last week, Trump signaled his intent to prioritize cryptocurrencies, stating, “We’re going to do something great with crypto because we don’t want China or anyone else—China especially—taking the lead. We want to be at the forefront.”
When pressed on whether the U.S. would develop a strategic bitcoin reserve similar to its oil reserves, Trump responded, “Yeah, I think so.”
As of July, governments globally held approximately 2.2% of bitcoin’s total supply, according to CoinGecko. The U.S. holds nearly 200,000 bitcoins, currently valued at over $20 billion. Other nations with significant bitcoin holdings include China, the UK, Bhutan, and El Salvador, according to data from BitcoinTreasuries.
Global Momentum for Crypto Reserves
The concept of national cryptocurrency reserves is gaining traction worldwide. Earlier this month, Russian President Vladimir Putin criticized the current U.S. administration for undermining the dollar’s role as the global reserve currency. He argued this has driven countries to explore alternative assets, including cryptocurrencies.
“For example, bitcoin—who can prohibit it? No one,” Putin remarked, emphasizing its appeal as a decentralized asset.
Skepticism Remains
Despite the excitement, skeptics warn that implementing a strategic bitcoin reserve could take considerable time. Federal Reserve Chair Jerome Powell recently compared bitcoin to gold, suggesting it is more of a speculative asset than a practical currency.
While enthusiasm remains high, analysts caution that logistical and regulatory hurdles could temper the pace of any government-backed crypto initiatives. For now, however, the market continues to revel in the prospect of greater institutional adoption and a potentially transformative shift in U.S. policy.
