A recently published analysis from Standard Chartered has sparked interest by proposing that a potential re-election of former President Donald Trump could have favorable effects on Bitcoin and other virtual currencies. The study addresses concerns surrounding the escalating risks associated with U.S. fiscal supremacy, driven by the potential piling up of national debt with the help of the Federal Reserve, potentially urging investors to shift towards digital assets for solace.

According to Standard Chartered analyst Geoff Kendrick, a second tenure under Trump's governance could pave the way for a regulatory environment that is more encouraging towards cryptocurrencies. This viewpoint opposes the common belief that the current Biden administration has maintained a relatively cautious or even unfriendly stance towards digital currencies.

Kendrick highlighted the potential of Bitcoin as a safeguard against the gradual decrease in reliance on the U.S. dollar and the diminishing trust in U.S. Treasury bonds. He underscored that certain economic outcomes, such as a more pronounced nominal yield curve and enhanced inflation expectations, could align positively with Bitcoin's performance trends.

The analysis also spotlighted Trump's previous strategies concerning the U.S. national debt, illustrating an average yearly net divestment of $207 billion during his presidential term compared to $55 billion under President Biden. This historical context implies a link between Trump's policy decisions and a probable inclination towards alternative assets like Bitcoin.

Furthermore, Standard Chartered foresees that a potential second Trump administration could relax regulatory frameworks, potentially opening the door for the endorsement of U.S.-based spot exchange-traded funds (ETFs) for Bitcoin and other digital currencies. These shifts in regulations could amplify trust within the digital asset market.

Despite not possessing any Bitcoin himself, Trump has demonstrated a willingness to engage with the cryptocurrency sector in the past. During an interview with CNBC earlier this year, he acknowledged the rising popularity of Bitcoin and indicated a lack of intent to hinder its development.

Regarding price estimations, Standard Chartered sustains an optimistic stance towards Bitcoin, projecting a closing price of $150,000 by the end of the year and a probable surge to $200,000 by the conclusion of 2025. These prognostications signify the increasing institutional attraction towards Bitcoin and the broader cryptocurrency landscape.