The economic anxiety of a Donald Trump presidency is giving cyber currencies like Bitcoin a short term boost, with their value rising substantially following Trump’s victory at the polls on Tuesday.
Bitcoin rose to a high of $737 following the election results, according to Coindesk, up from its $707 price when the market closed yesterday. Other electronic currencies reported similar gains, TechCrunch reported, including the relatively new ZCash.
Most of them have settled down after an initial spike, with Bitcoin dipping to around $720 late Wednesday. The fact that they spiked at all, though, means Trump’s victory is the latest evidence that cyber currencies are taking on the role that gold typically plays during periods of economic uncertainty.
But hoarding Bitcoin might not be as safe as safe investors seem to think. The online exchanges that people use to trade cyber currencies have increasingly been subject to hacking this year. In August, Bitcoin exchange Bitfinex was forced to halt trading after discovering a security breach, with $6 million in digital currency reported stolen.
In June, a hacker reportedly stole $50 million worth of Ether, a rival currency to Bitcoin. The potential theft raised panic within the cyber currency community, despite assurances that the underlying currency trading platform was not affected by the hack.
And then there is the existence and regulation of cyber currencies themselves: it is unclear what Trump’s position on Bitcoin is, but he has come down firmly against other technology controversies like protecting net neutrality and giving up control of the Internet’s Domain Name System.
What is clear is that the Trump administration must grapple with the legality of trading Bitcoin, and with what crimes it should charge people accused of stealing it. Such cases are already working their way through the courts, including a case in a state court in Florida in which the judge ruled that since Bitcoin was not actual money, a defendant who stole $1,500 of it could not be charged with money laundering.