Donald Trump’s return to the White House was greeted with enthusiasm in the crypto market. Experts and analysts predict that Trump will positively impact 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 strengthen further 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 major 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, emphasizes “depreciation trading”. This is a preferred investment strategy due to currency devaluation caused by inflationary policies. In this trade, investors purchase assets such as gold and Bitcoin, which are considered stores of value that can maintain their value even as a currency’s purchasing power declines.
JP Morgan analysts note that the depreciation trade “is likely to be strengthened by both tariffs and geopolitical tensions and an expansionary fiscal policy (‘debt reduction’).” In this context, analysts make the following statement:
We don’t 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 at which the central bank purchases gold will be crucial in determining the price trajectory of gold through 2025. They state that central banks greatly increased their gold assets in 2022 after the Ukraine war flared up and sanctions were imposed on Russia. The People’s Bank of China (PboC) suspended gold purchases last April. Analysts, however, expect ongoing tariffs and geopolitical tensions to lead central banks, including the PBoC, to move away from dollar reserves and towards gold.
Meanwhile, inflows into gold and Bitcoin ETFs have increased since last summer. For this reason, analysts state that retail investors support both gold and Bitcoin. Moreover, analysts predict that this trend will continue until 2025. They also predict that Trump’s policies will likely favor both entities.
Will Microstrategy’s plan boost BTC?
In addition, there are different factors that will further increase the Bitcoin price. One of these is Microstrategy’s bold BTC purchase plan. The plan calls for raising $42 billion in capital over the next three years. 21 billion dollars of this will come from equity. In addition, Microstrategy will raise another $21 billion from fixed income securities. Analysts also state that MicroStrategy will invest $10 billion in Bitcoin for 2025 alone. They note that this is approximately equal to their cumulative purchases since mid-2020.
