Nearly $10 Billion Invested in US Bitcoin ETFs Since Trump’s Election
Since Donald Trump's election, approximately $10 billion has entered US spot Bitcoin ETFs, reflecting optimism regarding potential support for the cryptocurrency industry. According to Bloomberg, major funds including BlackRock and Fidelity Investments have attracted around $9.9 billion in net inflows since November 5, raising total assets to about $113 billion.
Trump's Appointments Indicate Pro-Crypto Regulation Shift
Recent appointments by Trump, including a pro-digital asset leader for the US Securities and Exchange Commission (SEC) and a White House czar for artificial intelligence and crypto, suggest a move towards a more favorable regulatory environment. Trump has also endorsed the idea of a national Bitcoin reserve, which is gaining bipartisan traction, led by Senator Cynthia Lummis.
Bitcoin surpassed $100,000 for the first time on December 5, trading at around $96,898 as of Monday. Its six-week winning streak is the longest since the market surge of 2021, though concerns about volatility persist. David Lawant from FalconX indicated that sustaining a price above $100,000 will likely require additional positive catalysts.
Bitcoin Rally Benefits MicroStrategy and Other Firms
Bloomberg highlights that the favorable sentiment in cryptocurrencies has led to significant rebounds for companies like MicroStrategy, which sold $6.2 billion in convertible bonds this year and plans to raise an additional $21 billion. Other firms such as MARA Holdings and Core Scientific have also raised substantial funds for Bitcoin acquisitions.
MicroStrategy's stock (MSTR) has increased by 73% since the election, while shares of MARA, Riot Platforms, and Core Scientific rose by 63%, 33%, and 30%, respectively. This trend mirrors Bitcoin's nearly 40% growth during the same timeframe. With a market cap nearing $2 trillion, Bitcoin's recent rise has significantly boosted MicroStrategy's assets, now valued at over $41 billion.
The terms of recent crypto-related convertible deals are notable, especially those structured with zero coupons, facilitating convertible arbitrage for investors. Despite high demand for these instruments, market players show minimal concern regarding potential Bitcoin price drops. Raj Imteaz from ICR Capital LLC stated that larger market participants feel pressured to issue convertibles to remain competitive, emphasizing the need to maintain parity with competitors who have access to low-cost funding.
Featured image from DALL-E, chart from TradingView.com