In a bullish start to the week, Bitcoin has reached a new pinnacle, captivating the attention of investors as anticipations heighten over an impending interest rate cut by the Federal Reserve. Scheduled to be announced later this week, the potential move has fueled optimism within financial markets. Adding to the momentum, President-elect Donald Trump has unveiled ambitious plans to establish a U.S. Bitcoin strategic reserve, akin to the nation’s strategic oil reserve, a revelation that has electrified the cryptocurrency community.
MicroStrategy’s Inclusion in Nasdaq 100 Fuels Optimism
The excitement within crypto circles was further amplified by the recent news of MicroStrategy’s inclusion in the Nasdaq 100 index. This development is expected to channel additional investments into the software company, which has pivoted towards becoming a significant Bitcoin holder. Remarkably, Bitcoin has surged by an impressive 151% this year, showcasing its growing influence and popularity.
Trump’s Vision for Cryptocurrency Leadership
In a recent interview with CNBC, President-elect Trump hinted at his vision of ‘doing something great with crypto’, underscoring his commitment to positioning the United States as a leader in the digital currency domain, outpacing countries like China. When questioned about the possibility of establishing a crypto reserve analogous to the oil reserves, Trump affirmed, “Yeah, I think so.” Noteworthy, other nations such as China, the UK, Bhutan, and El Salvador have already accumulated significant Bitcoin reserves, with several others contemplating similar strategic reserves.
Geopolitical Shifts and Cryptocurrency
Earlier this month, Russian President Vladimir Putin remarked on the U.S. dollar’s diminishing role as the global reserve currency, attributing it to the American tendency to wield it for political leverage. This sentiment has prompted numerous countries to explore alternatives like cryptocurrencies. Despite these developments, some remain skeptical. Chris Weston, head of research at Pepperstone, cautioned, “I think we still need to be cautious on a BTC strategic reserve, and at least consider that this is not likely to happen anytime soon.”
Bitcoin’s Meteoric Rise Post-Election
Since the pro-crypto victory in the November 5 election, Bitcoin’s value has skyrocketed by over 50%. The cumulative market capitalization of cryptocurrencies has nearly doubled this year, reaching a record-breaking $3.8 trillion. Adding to the crypto-friendly atmosphere, Trump has nominated Paul Atkins, a known advocate for cryptocurrency, to lead the Securities and Exchange Commission (SEC).
Bitcoin Achieves Another Milestone
Bitcoin continues its remarkable rally in the fourth quarter of 2024, with its Energy Value metric surpassing the $100,000 mark. As of today, the Bitcoin Energy Value Simple Moving Average (SMA) has climbed to approximately $100,500, with the raw metric nearing $105,000, as noted by Charles Edwards of Capriole Investments. Edwards had predicted back in early March 2020 that Bitcoin’s Energy Value would reach $100,000 by 2025.
Federal Reserve’s Interest Rate Decisions
Investors are keenly awaiting the Federal Reserve’s two-day policy meeting concluding on Wednesday, where a rate cut is highly anticipated. The CME FedWatch Tool indicates a 96% probability of a 25-basis-point reduction, a scenario that is expected to further bolster Bitcoin prices.
