Bitcoin Values Soar Past $105,000 for the First Time, Strengthened Basics Propelling Increases
Bitcoin Values Soar Past $105,000 for the First Time, Strengthened Basics Propelling Increases
Bitcoin prices continued their robust climb on December 16, 2024, establishing a new peak as they leveraged robust fundamentals.
The leading digital currency, experiencing significant gains in the past few weeks, surpassed $107,850, according to data from Coinbase, as seen on TradingView.
Numerous analysts recognized this strong performance, including TikTok influencer Wendy O.
"With 2024 drawing to a close, we have a lot of anticipation and optimism for a pro-crypto president taking office," she stated via email.
"There's a rumor suggesting that Trump might issue an Executive Order on day one in office to establish a Bitcoin Strategic Reserve. This would help stabilize the dollar and combat the US debt crisis," claimed the analyst.
"Rumors of Japan and Russia creating their own Bitcoin Strategic Reserves also surfaced. With a limited supply of 21 Million Bitcoin, this could lead to a supply shortage, boosting prices further," she added.
Marc P. Bernegger, founder of cryptocurrency fund AltAlpha Digital, also shared his thoughts.
"The recent surge in Bitcoin's price, reaching above $105,000, can be attributed to several factors. The primary driver is the expectation of a potential US Bitcoin Strategic Reserve, as hinted at by President-elect Donald Trump," he stated through email.
"This sentiment has fueled investor optimism, anticipating this move could increase demand and legitimacy for Bitcoin," said Bernegger.
"Additionally, there have been notable Bitcoin transactions being shifted off major exchanges, decreasing the available supply, usually resulting in price increases," he noted. "Over 27,000 Bitcoins were transferred from exchanges this past weekend alone."
"Another positive development was MicroStrategy's inclusion in the Nasdaq 100 index," Bernegger mentioned.
Nasdaq announced on December 23 that the company would be part of the aforementioned index.
"This move symbolizes growing institutional adoption and interest in Bitcoin," the market observer asserted.
Jacob Joseph, research analyst at CCData, provided his perspective, focusing on anticipation surrounding the shifting US political landscape and other significant factors.
"The sustained momentum since the US elections illustrates a positive shift in Bitcoin's fundamentals, as the industry anticipates a more regulatory-friendly environment under the new US government and strong institutional adoption of the asset," he stated via email.
"Last week's U.S. CPI figures met expectations, potentially influencing another anticipated interest rate cut by the Federal Reserve later this week," said Joseph, referring to the policy meeting scheduled for December 17 and 18.
"Historically, December has been a favorable month for Bitcoin, averaging a return of 9.11% since 2014," he noted, referencing Bitcoin's market history.
"The ongoing rally could also profit from the 'Santa Rally,' a common seasonal trend observed in the stock market, where equities often experience positive price action in late December," Joseph stated.
Olivier Mammet, head of US OTC trading for Gemini, also commented on Bitcoin's recent gains.
"Much of this can be attributed to excitement as we approach Trump's inauguration in January," he stated.
"The pattern of swings on Sunday evening remains active, and the swift break through the $103,000 area can be explained by a market that's over-positioned," the market observer claimed.
"We saw perpetual funding turn negative on several exchanges over the weekend, indicating an increase in short positions that were quickly liquidated," he stated.
"On Friday evening, Nasdaq also announced that Microstrategy would join the Nasdaq 100 Index on December 23," said Mammet.
"We also have the FOMC meeting this week, and although a 25bps cut is expected (over 90% probability), the market could be positioning for it," he concluded.
Disclosure: I own some Bitcoin, Bitcoin Cash, Litecoin, Ethereum, EOS, and SOL.
The statement by Marc P. Bernegger, from cryptocurrency fund AltAlpha Digital, further highlights the impact on Bitcoin prices, as he mentions, "The recent surge in Bitcoin's price, reaching above $105,000, can be attributed to several factors, including the expectation of a potential US Bitcoin Strategic Reserve."
Analysts like Jacob Joseph from CCData also attribute Bitcoin's price increase to various factors, such as the anticipation of a more regulatory-friendly environment under the new US government and strong institutional adoption of Bitcoin. He notes, "The sustained momentum since the US elections illustrates a positive shift in Bitcoin's fundamentals."