The crypto market expects the actions of US President-elect Donald Trump's administration to have a positive impact on the entire blockchain industry.
In addition, part of the community expects the fulfillment of election promises to include bitcoin in the national reserve. Experts believe that the emergence of a national bitcoin reserve in 2025 is unlikely, but in the coming year they expect the trend of adding the main cryptocurrency for the reserves of individual companies to strengthen.
Trump's idea to add bitcoin to the US national reserve is unlikely or even “crazy”, at least next year, according to experts including Bitwise management company, US Federal Reserve (Fed) chief Jerome Powell and Lawrence Summers, who served as US Treasury Secretary from 1999-2001.
Bitwise IT director Jeff Park estimated the likelihood of such a plan happening at less than 10%. And Powell, as well as Summers, did not support the idea at all. And even those who are generally positive about the incoming administration point to legislative and regulatory obstacles to adopting such drastic changes to the state reserve.
Park believes that the success of bitcoin adoption in the U.S. could push the price of the major cryptocurrency to $1 million per coin or higher: “The idea of a federal strategic bitcoin reserve in 2025 is an event with a less than 10% probability of happening. This is the only reason bitcoin could reach $1 million or higher in 2025.”
However, even if the Trump plan doesn't materialize, demand for bitcoin from traditional companies is expected in 2025
The reason for the development of such a trend may be the success of MicroStrategy and a number of other companies, whose shares rose in value after the adoption of a strategy to create a reserve in bitcoin. This opinion was expressed to The Block by Jake Ostrovskis, a representative of Wintermute, one of the largest market makers in the crypto market.
The basic idea behind buying bitcoin to bolster corporate balance sheets is that it can improve a company's balance sheet while boosting its stock price. This strategy was started by MicroStrategy (MSTR) under the leadership of its chairman Michael Saylor.
As bitcoin has accumulated since September 2020, MicroStrategy shares have risen more than 2000%, reaching an all-time high of $543 in late November. The previous price peak was at $333, recorded in January 2000, according to data from the TradingView platform as of Dec. 27, MSTR is trading around $341.
“I think this will be a pretty strong driver next year,” the expert wrote.
“I would say Saylor's success makes this strategy more palatable to other public companies. I suspect there will be more of them in the near future,” Two Prime Digital Assets CEO Alexander Blum told The Block.
“Once upon a time, buying bitcoin for balance was a reality only for crypto natives. Now it's becoming mainstream amid promising post-election prospects. Expect more and more publicly traded companies to spend their surplus money looking at bitcoin as a reserve asset,” said Anchorage Digital CEO and co-founder Nathan McCauley.
In addition to the continuing trend of buying bitcoin for balance sheets, Ostrovskis predicts that some companies may start using Ethereum as an investment vehicle, “It's probably a matter of time before someone does the same with Ethereum.”
In addition to buying physical bitcoin, related trading tools to this strategy are emerging
For example, Bitwise, a Bitcoin management company, has applied for a new exchange-traded fund (ETF), the Bitwise Bitcoin Standard Corporations ETF, which will only buy shares of companies that will add bitcoin to their balance sheets
Another bid for a “related” fund to MicroStrategy has been submitted by Strive, a management company co-founded by Vivek Ramaswamy. Ramaswamy is expected to co-head the Department of Government Efficiency (the acronym D.O.G.E, consonant with the Dogecoin memcoin ticker (DOGE) ) alongside Tesla's chief carmaker Elon Musk.
The fund, called the Strive Bitcoin Bond ETF, unlike Bitwise, does not target the purchase of company stocks, but only debt securities that are issued by companies for future bitcoin purchases.
MicroStrategy has been issuing such debt and plans to do so in the future. Its experience has also been adopted by the largest U.S. mining company MARA (MARA). For example, in November MARA issued bonds totaling $700 million with maturity until 2030 - part of the raised funds they used to buy bitcoin.However, this had no effect on MARA prices - in 2024 the company's share price fell by about 18%.
In 2024, a similar strategy to MicroStrategy began to be applied outside the United States. Since November, Japanese investment firm Metaplanet has sold the same debt, with the goal of buying at least $11.3 million worth of bitcoin. The company's share price has increased more than 12 times to $21.9 since April 2024, when the organization first bought bitcoin on its balance sheet, according to the BitcoinTreasuries service.
Despite MARA's lack of share gains, the markets have been largely positive about companies adopting a bitcoin strategy. Investopedia reports that shares of KULR Technology (KULR) rose to a record $4.8 after announcing a $21 million bitcoin purchase.The purchase came after the company announced it was moving to a bitcoin strategy in early December. KULR's price has roughly quadrupled in a month.
Another company applying a bitcoin strategy is Semler Scientific. Its share price has more than tripled since October to $72 when it first added bitcoin to its balance sheet. According to BitcoinTreasuries, the company was able to accumulate almost 2.1k $BTC BTC or nearly $200 million by the end of December through several purchases.
