Projected US President-elect Joe Biden on Tuesday appointed Gary Gensler, a Washington and Wall Street financial expert who has closely monitored the evolution of the cryptocurrency market, to lead his financial policy transition team.
This is coming at a time when the volume of bitcoin transactions has been on an impressive bullish run, surging more than 270 percent over the past month.
Unlike in 2016 when the world’s most valuable cryptocurrency experienced a bumpy trajectory following the US election, this year bitcoin picked up the pace after the election in which the incumbent President Donald Trump is set to be defeated. Bitcoin has increased by more than 15 percent in less than two days. The crypto almost touched $16,000 last week as it marked another 2020 high at a little over $15,900.
“The bitcoin price is currently ranging between $15,000-$16,000. A flip of the $16k level on a weekly basis would be very bullish and take us towards the all-time high levels of December 2017,” said analysts at Luno, a global exchange rate with a presence in Nigeria and other African countries.
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Analysts hope that the appointment of Gensler is a signal that the new US government is ready to take a positive approach to regulate the cryptocurrency market. In the recent past, Gensler was called to testify before Congress about cryptocurrency and blockchain on multiple occasions. On different occasions, he pushed back against comparisons between cryptocurrencies and Ponzi schemes and declared that the much-disputed Facebook Libra token had indeed met requirements of being a security under US law.
He also made favorable comments regarding Ripple token XRP, arguing that there was a strong case XRP is a security.
While the appointment has not had much impact on the movement of price, cryptocurrencies across the board have been in the green zone in recent times. Ethereum, in particular, has seen some positive price movement. ETH price is $461 as of press time on Wednesday, which is up 3 percent over the last 24 hours.
The much anticipated Ethereum 2.0 also seems to be moving in the right direction as data from Nansen shows that almost 130,000 Ethereum wallets are ready for staking. This number has grown by 15 percent this year and has accelerated over the past month. Wallets must hold more than 32 ETH to participate in staking and to operate as validators when Ethereum 2.0 goes live.
But some experts say the aftermath of the US election is not entirely responsible for the upward price movement in the market. Matthew Dibb co-founder, and COO of Singapore-based Stack Funds attributes the growth to increased institutional investments over the past few weeks.
“Over the past eight weeks, we have seen various public companies and hedge funds enter the cryptocurrency market with sizeable deployment of capital,” he said. To buttress his point, on September 15, MicroStrategy, a listed business intelligence firm said it has bought $250 million worth of bitcoins, and three weeks later Square, a payment company founded by Twitter’s Jack Dorsey disclosed its investment in the bitcoin market.
Nevertheless, analysts at Luno say the bullish run will only remain if the price of bitcoin breaks the $16,000 market as another failed attempt could potentially see the “price cool off a bit, and likely take us down to the $14,000 level again.”
