Trump's Policy Promises Pass Congress
Bitcoin Rally Gains Momentum
Nearly 5 Trillion Won Inflows in May Alone
Largest Monthly Inflow Since January
Bitcoin, the leading cryptocurrency, has reached the "dream milestone" of $110,000, setting a new all-time high in its 16-year and 4-month history. The rally was fueled by the passage of a series of policies promised by U.S. President Donald Trump, including a strategic reserve bill for cryptocurrencies, through the U.S. Congress. Ahead of the bill's passage, nearly 5 trillion won flowed into Bitcoin exchange-traded funds (ETFs) in May alone.
The securities industry expects Bitcoin's upward trend to continue. Analysts point out that concerns over the global economy and increasing volatility could drive more capital into Bitcoin.
According to CoinMarketCap, a global cryptocurrency market data site, Bitcoin was trading at $110,609 as of 4:00 p.m. (Korean time) on May 22. This represents a 2.61% increase from the previous day and an 88% rise compared to seven days ago.
On this day, Bitcoin surged to $110,724 at around 9:25 a.m., breaking through the $110,000 mark for the first time before retreating below $110,000 as gains were pared. However, it later reclaimed the $110,000 level and even surpassed $111,000 in the afternoon.
The actions of major investors have also accelerated, with significant capital inflows into spot Bitcoin ETFs. According to the UK’s Financial Times (FT), as of May 21, more than $3.6 billion (about 4.9492 trillion won) had flowed into U.S. spot Bitcoin ETFs during May alone. This is the largest monthly inflow since January of this year.
The push for cryptocurrency legislation by the potential second Trump administration appears to have driven Bitcoin's rally. In the U.S. Senate, the National Innovation Establishment for Stablecoins Act (GENIUS Act) passed a cloture vote on May 20 with 66 votes in favor, 32 against, and 2 abstentions. Stablecoins are cryptocurrencies whose value is pegged to specific assets such as the U.S. dollar or euro to minimize price volatility. The bill stipulates requirements such as one-to-one reserve holdings by stablecoin issuers, mandatory anti-money laundering (AML) measures, consumer protection, and oversight by federal and state regulatory agencies.
While the bill is essentially a regulatory law, the market generally interprets it positively as it reduces regulatory uncertainty. Yesha Yadav, a professor at Vanderbilt Law School, told UK Newsweek, "If the GENIUS Act passes the full session, it will mark a significant turning point as the cryptocurrency market is incorporated into the mainstream financial system."
On the same day, the Texas House of Representatives passed a strategic Bitcoin reserve asset bill. This bill, which calls for the long-term holding of cryptocurrencies with a market capitalization of over $500 billion within the past 12 months, has passed the legislature and now only awaits the governor's signature. Once signed, Texas will become the second U.S. state to officially allow Bitcoin reserves, following New Hampshire, where the governor signed a similar bill on May 6.
The fact that Texas ranks second in economic size among the 50 U.S. states is one of the reasons for heightened expectations. According to Cointelegraph, a cryptocurrency-focused media outlet, Texas's gross domestic product (GDP) in 2024 is approximately $2.7 trillion, the second largest in the U.S. According to Statista, Italy, ranked eighth in global GDP last year, had a GDP of $2.3765 trillion. This is even larger than South Korea, which ranked twelfth with a GDP of $1.8699 trillion.
Meanwhile, the barriers to cryptocurrency investment are also falling. On May 19, global investment bank JP Morgan announced that it would allow its clients to purchase Bitcoin. Jamie Dimon, CEO of JP Morgan, attended the bank's annual investor event in New York, stating, "I do not encourage smoking, but I defend your right to smoke," adding, "I also defend your right to buy Bitcoin." However, he clarified that JP Morgan itself would not provide custody services for Bitcoin.
The upward trend of Bitcoin is expected to continue. Kim Yumin, a researcher at Hanwha Securities, said, "There are growing concerns about the economy, and volatility in the U.S. stock market is persisting," adding, "Interest rates remain high, but the dollar index has fallen to 100." He further assessed, "As demand for alternative assets increases, trust in Bitcoin is rising."
He emphasized, "Currently, the process for stablecoin legislation is underway, and state governments are also passing Bitcoin reserve bills," adding, "As Bitcoin starts to be incorporated into the traditional financial system, investors are finally beginning to focus on its characteristics as a safe-haven asset."
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