Bitcoin Strategic Asset Failure Throws Crypto Market into Chaos
Semi-title: "U.S. Bitcoin Strategic Asset Bill Repealed: Ripple, Solana, and Other Cryptocurrencies Plummet."
@Mark, this news is significantly related to the price changes of major cryptocurrencies like Ripple, Solana, and Ethereum, so it seems suitable for you. Please analyze the impact that the repeal of this bill might have.
Yes, we will prepare.
Let's start the analysis.
With the automatic dismissal of the "Bitcoin 2024 Strategic Asset Bill" proposed by Senator Cynthia Lummis due to the session ending in the U.S. Senate, there was a sharp decline in the prices of cryptocurrencies such as Bitcoin and Ethereum in the New York stock market. This occurred because investors who had expected the bill to have a positive impact on the cryptocurrency market viewed its dismissal as a negative development.
The Bitcoin Strategic Asset Bill included a provision where the Federal Reserve would purchase up to 200,000 bitcoins annually and hold them for a minimum of 20 years. This would require the Federal Reserve to reduce the dollar amount in its surplus account and use part of its net profit for bitcoin purchases. This had been sending a strong signal to the market, driving up the value of Bitcoin.
The bill's dismissal occurred due to the end of the 118th Congress without sufficient legal groundwork, and unless it is reintroduced in the new 119th Congress, it will not be considered. President-elect Trump has indicated an intention to designate Bitcoin as a strategic asset, but there is skepticism about whether this will be implemented once he takes office. Ki Young Ju, CEO of CryptoQuant, also expressed the view that it is unlikely the United States would stockpile Bitcoin as a strategic asset, given the strong position of the U.S. economy and the dollar.
In Japan, Representative Satoshi Hamada has proposed adopting Bitcoin as a national strategic asset, emphasizing its scarcity and decentralization. He argues that Bitcoin could establish a fair financial environment. This discussion aligns with similar debates in the United States, Russia, Argentina, and other nations.
On the other hand, the city of Vancouver in Canada is exploring the use of Bitcoin in municipal financial operations. This follows the passage of a bill aimed at making Vancouver a Bitcoin-friendly city. The bill includes provisions for the city to accept taxes and fees in Bitcoin and hold a portion of its reserves in Bitcoin.
In the case of Ripple (XRP), there was a significant increase in price following the resignation of SEC Chairman Gary Gensler. This rise is attributed to expectations of regulatory easing, as XRP had suffered considerably under Gensler's stringent regulations. With the SEC having categorized XRP as a security and pursued legal action and fines, Gensler's resignation raises the possibility of changes in this regulatory stance.
This situation has once again highlighted the high volatility of the cryptocurrency market. Changes in legislation, movement of regulatory authority assets, and policy shifts by key figures all have a substantial impact on the market, leading investors to react more sensitively to short-term changes rather than focusing on long-term strategies.
@Victoria, could you please review the analysis and provide feedback? Expertise in cryptocurrency and the overall investment market is required.
Yes, we will prepare.
