We saw President Donald Trump signed an executive order promoting digital assets and other financial technologies Thursday (23 Jan).
The order contained the items of the cryptocurrency-related campaign promises that Trump had made before his election. The order will established a working group intended to shape regulation and White House policy around crypto and other digital assets.
Special Advisor for AI and Crypto David Sacks will chair the group, according to the order, with the Treasury Secretary, Secretary of Homeland Security, and others participating.
Review and Evaluate Regulatory Frameworks - A Good Start
The group will be reviewing current crypto regulatory frameworks and establishing new guidelines, on top of this, the group will be also evaluating the "potential creation and maintenance of a national digital asset stockpile." The stockpile proposal will support the President’s calls for a bitcoin stockpile during his campaign trail.
One important thing to note is the order prohibit the establishment of a central bank digital currency in the United States, but the order have a section which include the promotion and protection of dollar-backed stablecoins around the world.
How Bitcoin Traded After The Order Released
Bitcoin traded around $103,000 in the hours following the release of the order, down slightly from levels seen earlier in the day. There is no surge seen, and at time of this writing, we are seeing $CME Bitcoin - main 2501(BTCmain)$ trading at slightly above $104,000.
A Significant Increase Of Bitcoin On-Chain Volume Seen
We are seeing a significant on-chain volume increase on daily 7 day MA, this could signal that we might be seeing a price surge of Bitcoin later this week (over the weekend).
Traders and investors should be looking at how the latest executive order is going to affect Bitcoin, because the stockpile for Bitcoin, are we going to see buying of Bitcoin from government and U.S. corporates?
Increase Seen On Bitcoin New Addresses On Bitcoin Network
As mentioned above, we need to see if there will be more corporations coming to buy Bitcoin, one way I would look at it would be the number of new addresses on the Bitcoin Network over 7 days MA,
If corporations is going to load up Bitcoin, then we will see more and more of them creating new addresses, so hope that majority of these new addresses is coming from corporations (I will cover in another article).
So this is something I would be monitoring over next week.
Active Addresses On Bitcoin Network Also Seen Increasing
If we were to see how Bitcoin was traded, I would look at the active addresses on the Bitcoin network, it seems like there is an increase since the crypto executive order by President Trump was signed.
So this is another area to look at as these existing institutional or retail investors might be loading up. So I will be watching more in depth.
Why Bitcoin Miners and Holders Would Benefit
Bitcoin miners and holders would benefit as there is only so much Bitcoin in circulation, if the crypto working group start to plan in building up the stock pile.
They would be looking to acquire, one of the biggest Bitcoin holders is $MicroStrategy(MSTR)$ is one of the largest holders of Bitcoin in the world. As of 20 Jan, MicroStrategy reported that it held roughly 461,000 Bitcoins acquired for $29.3 billion, or roughly $63,610 per Bitcoin. Between Jan. 13 and Monday, the company acquired 11,000 Bitcoins for $1.1 billion in cash.
So I am expecting MSTR share to have some positive effect. I am holding onto my MSTR position.
Summary
We will need to wait for more details to be released over the next few weeks from the working group, but in the meantime, we can start planning on what might move.
Appreciate if you could share your thoughts in the comment section whether you think Bitcoin would move higher as more will start to acquire Bitcoin?
@TigerStars @Daily_Discussion @Tiger_Earnings @TigerWire appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts.
Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.
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