Bitcoin rebounds from its biggest decline since the election, traders carefully weighing potential impact of Trump's policies.

Bitcoin prices have seen exacerbated fluctuations, rebounding from the largest two-day decline since the US election results were announced, reflecting a change in assessment of the impact of President-elect Trump's policy agenda. Data shows that Bitcoin fell nearly 3% last Saturday and Sunday. As of press time, Bitcoin has risen to just below $92,000, but still below the historical high of around $93,000 set last week. During the campaign, Trump made various promises supporting cryptocurrencies, including establishing a US Bitcoin reserve and creating a crypto-friendly regulatory framework. However, the feasibility and implementation timeline of these promises are still uncertain. Tony Sycamore, market analyst at IG Australia Pty, pointed out that since November 5th, the US election day, Bitcoin has seen a record-breaking increase, and since then Bitcoin has become "overheated," with "a lot of good news already reflected in the price." Although Trump's business-friendly stance has made both the US stock market and cryptocurrency investors active, risks stemming from trade tariff policies and potential fiscal deficits due to tax cuts are dampening some of the optimism. Due to Trump's proposed economic policies possibly leading to resurgent inflation, investors are lowering expectations of rate cuts by the Federal Reserve during a period of stable economic growth in the US, which could be a barrier to the rise of cryptocurrencies as liquidity conditions may impact speculative demand for cryptocurrencies. JPMorgan strategist Nikolaos Panigirtzoglou stated that under the Trump administration, a more cooperative regulatory shift towards cryptocurrencies may soon be approved, allowing banks more room to engage in investment in crypto assets. Exchange-traded funds (ETFs) trading other cryptocurrencies (not just Bitcoin and Ethereum) may have a better chance of approval. However, the strategist also noted that establishing a US Bitcoin reserve is a "low probability event."