surged to a historic high above $106,000 on Monday, 16 December 2024, following remarks by President-elect Donald Trump, who hinted at plans for a US Bitcoin strategic reserve akin to the nation’s strategic oil reserve.
The announcement ignited a bullish surge among investors, pushing the world’s most valuable cryptocurrency to a record high of $106,533 before settling at $104,462, marking a 3.2% gain for the day.
Ethereum (ETH), the second-largest cryptocurrency, also saw gains, climbing 1.5% to $3,965.
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Bitcoin Next To Hit $110,000
Tony Sycamore, an analyst at IG, told Reuters that “we’re in blue sky territory here.” He claimed that the “next figure the market will be looking for is $110,000.”
“The pullback that a lot of people were waiting for just didn’t happen, because now we’ve got this news,” Sycamore said.
Investor sentiment was further boosted by MicroStrategy’s inclusion in the tech-heavy Nasdaq 100 index. The software company, which has become one of the largest institutional holders of Bitcoin, is expected to see increased inflows, reinforcing market confidence.
Trump’s statements have reignited investor optimism for a more favorable regulatory stance on cryptocurrencies. Speaking to CNBC, Trump declared, “We’re gonna do something great with crypto because we don’t want China or anybody else – not just China but others are embracing it – and we want to be the head.”
When asked about the possibility of a Bitcoin reserve, Trump replied, “Yeah, I think so.”
Global governments currently hold around 2.2% of Bitcoin’s total supply, according to CoinGecko. The US reportedly possesses close to 200,000 Bitcoins, valued at over $20 billion at present prices.
Michael Saylor calls on the US Government to sell all of its gold and buy #Bitcoin. pic.twitter.com/G25G6uXHOf
— Watcher.Guru (@WatcherGuru) December 15, 2024
Other notable holders include China, the UK, Bhutan, and El Salvador, according to data from Bitcoin Treasuries.
Talk of cryptocurrency strategic reserves is not new. Russian President Vladimir Putin recently criticized the US for weaponizing the dollar’s reserve status, pushing other nations to explore alternatives like Bitcoin.
Skepticism remains, however, with US Federal Reserve Chair Jerome Powell comparing Bitcoin to gold. Analysts, too, caution that a US Bitcoin reserve would be complex to implement.
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Texas Proposes Creating Bitcoin Reserve
Last week, Texas introduced a new bill to establish a strategic Bitcoin reserve. The legislation proposes that the state accept Bitcoin payments for taxes, fees, and donations, with the collected Bitcoin held in reserve for at least five years.
Pennsylvania was the first state to introduce a strategic Bitcoin reserve bill in November, while other states, including Oklahoma, Louisiana, Montana, and Arkansas, have enacted laws protecting the rights to mine, self-custody, and conduct peer-to-peer Bitcoin transactions.
Wyoming Senator Cynthia Lummis has also proposed legislation to create a federal Bitcoin reserve.
On the network side, Bitcoin’s hashrate has reached unprecedented levels, signaling a surge in mining activity. Data from Glassnode shows the hashrate soaring from 128 EH/s to over 804 EH/s in 2024, with 37% of total computational activity occurring this year alone.
The increased security has enabled Bitcoin miners to generate a cumulative $71.49 billion in revenue.
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