Donald Trump’s return to the White House was greeted with enthusiasm in the crypto market. Experts and analysts predict that Trump will positively affect the market due to his crypto-friendly approach. JPMorgan analysts expect Donald Trump’s victory to benefit both Bitcoin and gold. Analysts predict that Bitcoin will get even stronger thanks to MicroStrategy’s $ 42 billion BTC purchase plan.
JPMorgan analysts are hopeful for gold and Bitcoin in the Trump era!
With Donald Trump’s landslide victory, experts predict that Bitcoin will surpass important benchmarks by 2025. Therefore, market sentiment suddenly turned positive. Moreover, JPMorgan analysts predict a strong outlook for both gold and Bitcoin. The bank’s team, led by managing director Nikolaos Panigirtzoglou, emphasises the ‘depreciation trade’. This is an investment strategy favoured due to currency devaluation caused by inflationary policies. In this trade, investors buy assets such as gold and BTC , which are considered stores of value that can retain their value even as a currency’s purchasing power declines.
JP Morgan analysts note that the depreciation trade ‘is likely to be reinforced by both tariffs and geopolitical tensions and an expansionary fiscal policy (’debt reduction‘)’. In this context, analysts make the following explanation:
We do not see gold’s initial negative market reaction as a rejection of the ‘depreciation trade’ due to Trump’s win. After all, Bitcoin, the other component of the ‘depreciation trade’, rallied after Trump’s win.
Analysts expect gold and Bitcoin prices to rise
Analysts also note that the pace of central bank gold purchases will be crucial in determining the price trajectory of gold until 2025. They note that after the escalation of the Ukraine war and the imposition of sanctions on Russia, central banks greatly increased their gold holdings in 2022. The People’s Bank of China (PboC) suspended gold purchases last April. Despite this, analysts expect ongoing tariffs and geopolitical tensions to lead central banks, including the PBoC, to move away from dollar reserves and towards gold.
Meanwhile, inflows to gold and Bitcoin ETFs have increased since last summer. Therefore, analysts state that individual investors favour both gold and Bitcoin. Moreover, analysts predict that this trend will continue until 2025. They also predict that Trump’s policies will likely favour both assets.
Will Microstrategy’s plan lift BTC?
In addition, there are other factors that will further boost the Bitcoin price. One of them is Microstrategy’s bold BTC purchase plan. The plan involves raising $42 billion in capital over the next three years. Of this, $21 billion will come from equity. In addition, Microstrategy will raise the other $ 21 billion from fixed-income securities. Analysts also state that for the year 2025 alone, MicroStrategy will invest $ 10 billion in Bitcoin. They note that this is approximately equal to their cumulative purchases since mid-2020.
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