Cathie Wood Predicts Trump Administration Will Bring 'Regulatory Clarity' to Bitcoin, DeFi

Cathie Wood, CEO of ARK Invest, has shared her insights on the potential impact of a Trump administration on Bitcoin (BTC) and decentralized finance (DeFi).

Cathie Wood, the CEO of ARK Invest, has shared her thoughts on the potential impact of a Trump administration on Bitcoin ( BTC/USD ) and decentralized finance (DeFi).

According to Wood, the administration could bring much-needed “regulatory clarity” to the fintech sector, especially if Gary Gensler steps down from his position.

In a webinar that was pre-recorded on Nov. 15 and aired on Friday, Wood discussed how the Trump administration might influence the digital asset revolution, led by Bitcoin.

“If Gary Gensler leaves, that is going to open us up to regulatory clarity and probably, given the Trump administration's pronouncements over the last few months, give much more focus on the digital asset revolution, broadly led by Bitcoin, which they may put in the Treasury's strategic reserve,” she said.

Given the current circulation of over 19 million Bitcoin and a cap of 21 million, Wood suggested the possibility of adding Bitcoin to the U.S. Treasury's strategic reserve. According to her, the government might aim to acquire 1 million Bitcoins over time.

On the topic of DeFi, Wood highlighted the potential for peer-to-peer lending to eliminate intermediaries in financial transactions.

Yassin Elmandjra, ARK's director of digital assets, pointed out the accelerating trend of using cryptocurrency for commerce, thanks to technological and regulatory advances.

Elmandjra emphasized the need for clear government regulations on compliance, tax implications, and consumer protection to help businesses navigate the evolving landscape.

These predictions come as Wood has set ambitious price targets for Bitcoin, including a bull case of $3.8 million if more companies decide to include the cryptocurrency in their balance sheets.

However, a recent Benzinga survey showed skepticism, with 83% of respondents doubting this target will be reached by 2030.

Moreover, ARK Invest has noticed an “uptrend” in Bitcoin's market structure, which is linked to oversold conditions in the Stablecoin Supply Ratio Oscillator (SSRO).

This indicator, which measures Bitcoin's potential purchasing power, reached a significant low in September, a level last seen during the 2022 bear market. The SSRO is calculated by dividing Bitcoin's supply by the supply of major stablecoins, providing insight into Bitcoin's market dynamics.

Price Action: At 8:03 am ET, Bitcoin was trading at $98,764.01, Ethereum was at $3,345.98, and Dogecoin was at $0.4045. In the past 14 days, post the elections, Bitcoin's value experienced a 29.9% increase, Ethereum increased by 14.7%, and Dogecoin saw a 105.5% hike.

Meanwhile, ARK 21Shares Bitcoin ETF (NYSE: ARKB) was trading only slightly higher at 0.58% during pre-market hours.

This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.