Dec 16 2024: Bitcoin soared to an all-time high on Monday, surpassing $106,000, driven by optimism surrounding President-elect Donald Trump’s comments about a potential Bitcoin Strategic Reserve and MicroStrategy’s inclusion in the Nasdaq 100 index.
The cryptocurrency rebounded from a weekend slump, trading at $106,569.4 before stabilizing around $104,977.1 by 00:47 ET (05:47 GMT).
Trump Advocates for a Bitcoin Reserve
Trump, in a CNBC interview last week, hinted at plans to establish a Bitcoin reserve akin to the Strategic Petroleum Reserve, aiming to solidify the U.S.’s role as a global leader in cryptocurrency. He emphasized the need to compete with nations like China that are advancing in crypto adoption.
While Trump’s pro-crypto stance has boosted sentiment, analysts remain skeptical about funding such a reserve amid fiscal constraints, particularly with a Republican-led Congress prioritizing deficit reduction. An alternative could involve leveraging the U.S. government’s existing holdings of over 200,000 Bitcoins, according to CoinGecko.
MicroStrategy Joins Nasdaq 100
Market optimism was further bolstered by Nasdaq’s decision to include MicroStrategy Incorporated (NASDAQ:MSTR) in the Nasdaq 100 index. As the largest corporate Bitcoin holder, MicroStrategy’s addition is expected to draw institutional investments into the stock and, indirectly, into Bitcoin.
MicroStrategy’s stock, which has surged over 400% this year, has been viewed as a Bitcoin proxy play, especially as the firm continues its aggressive Bitcoin acquisitions, primarily financed through debt.
Crypto Market Trends: Altcoins and Fed Anticipation
Bitcoin’s rise spurred gains across the crypto market, with Ether climbing 2% to $3,972.39 and XRP holding steady at $2.4123. Solana, Cardano, and Polygon each saw modest increases of around 1.3% to 1.5%.
Meme coin Dogecoin also rose 1.8%, reflecting the broader upbeat sentiment despite the looming Federal Reserve meeting. The Fed is expected to cut rates by 25 basis points but could signal a slower pace of reductions in 2025 due to persistent inflation concerns.
Bitcoin’s surge, coupled with Trump’s plans and institutional momentum, underscores the evolving dynamics of the cryptocurrency market as it integrates further into mainstream financial ecosystems.
