Are you ready for the next BTC wave?
Author and source: Meta-Luban
Bitcoin's historic moment in its heyday
2024 is destined to go down in the history of the cryptocurrency world, with Bitcoin's market value exceeding $1.9 trillion, ranking seventh among the world's most valuable assets and companies.
Looking back on this year, Bitcoin has not only broken through multiple historical barriers, but also established a more important position in the capital market and in the hearts of global investors. Whether it is the approval of spot ETFs, the policy dividends brought by Trump's re-election, or the price breaking through the $100,000 mark, Bitcoin has completed the transformation from a safe-haven asset to a global core investment target this year.
Milestone Events
01/10 Bitcoin spot ETF approved, institutional enthusiasm begins
04/19 The fourth halving, scarcity further increased
04/30 Hong Kong launches Asia’s first spot Bitcoin ETF
07/13 Trump's assassination shocked the market
09/18 The interest rate cut cycle begins, and funds flow into crypto assets
11/06 Trump was successfully re-elected as the US President, and market confidence is high
11/19 Bitcoin spot ETF options launched, tool ecosystem further improved
12/05 Trump nominates Paul Atkins as SEC Chairman, crypto-friendly signals emerge
12/06 David Sacks announced as the first “AI and Crypto Czar”
12/12 Trump promises major action on cryptocurrencies
Bitcoin breaks through $100,000: a feast for capital
In 2024, Bitcoin's annual increase was as high as 180%, which not only set a record high, but also triggered a frenzy of pursuit in the capital market. The strongest month of the year was February, with a monthly increase of 52%. After Trump won the election in November, Bitcoin broke through the $100,000 mark in one fell swoop, becoming the most dazzling star in the financial market. Data analysis shows that since Trump's victory, the price of Bitcoin has risen by nearly 60%. This series of major events not only laid the foundation for Bitcoin's highlight moment in 2024, but also laid a solid foundation for future growth.
Cryptocurrency concept stocks exploded
Bitcoin's strong performance also led to a collective surge in cryptocurrency concept stocks.
Judging from the performance of US cryptocurrency concept stocks this year, the share price of "big coin holder" $MicroStrategy (MSTR.US)$ soared by more than 520%, becoming the biggest winner in the cryptocurrency bull market. Bitcoin mining company $TeraWulf (WULF.US)$ rose by 213%, $Bitdeer Technologies (BTDR.US)$ rose by more than 116%, $Hut 8 (HUT.US)$ rose by more than 100%, $IREN Ltd (IREN.US)$ rose by more than 87%, and cryptocurrency exchange giant $Coinbase (COIN.US)$ rose by nearly 80%.
MicroStrategy has relied on its bold Bitcoin reserve strategy, and as Bitcoin has been soaring, Bitcoin spot ETFs have also seen a surge. As of November 30, 2024, 45 funds held 1,266,862 Bitcoins. In less than a year, the ETF accounted for 6% of the total Bitcoin supply, exceeding Satoshi Nakamoto's holdings. According to Farside Investors, as of December 21, 2024, the U.S. Bitcoin spot ETF has accumulated a net inflow of more than $36 billion since its launch.
It is worth noting that the asset size of the Bitcoin spot exchange-traded fund (ETF) launched by BlackRock surpassed its gold exchange-traded fund iShares Gold ETF (IAU) in October this year, and it was achieved in just 10 months. It should be noted that iShares Gold TF (IAU) was launched by BlackRock in January 2005.
Looking at the overall investment market throughout the year, the fourth halving of Bitcoin has increased its scarcity, the influx of institutional funds, the boost of macroeconomic factors, and the improvement of the global policy environment. The strong performance in 2024 has aroused more expectations from investors for the future. The value of Bitcoin is not only reflected in its price increase, but also in its challenge to the traditional financial system and its shaping of the future financial world.
Bitcoin outperforms traditional investments like stocks and gold in 2024
Why did the market rise so much? Three major driving factors
1: Supply side: Bitcoin halving effect
From the supply side, after the historical halving events, the cryptocurrency market often ushered in a market start-up about half a year later. The supply contraction effect brought about by the halving is gradually emerging, pushing the market into a new round of rising cycle in mid-to-late 2024. This scarcity of supply further attracted institutional investors and long-term holders (HODLers) to continue to increase their holdings, injecting strong upward momentum into the market.
2: Demand side: Trump’s re-election and favorable policies
Trump's victory is seen as one of the biggest drivers of Bitcoin's rise. During his campaign, he repeatedly stated that the innovative spirit of cryptocurrency is in line with the core values of the United States. Most of the cabinet members are cryptocurrency-friendly, and he has successfully built a "crypto-friendly" team, which has greatly boosted market confidence. Compliance process - the upcoming (FIT21 Act) and (DAMS Act) in the United States are pushing Bitcoin and other crypto assets to gradually get rid of the "gray area". This policy change provides global investors with new asset allocation options and also brings more stable long-term development possibilities to the digital currency industry.
Exploration of strategic Bitcoin reserves. Since the US election, the call for the establishment of a national strategic Bitcoin reserve has been growing. It is also one of President Trump's cryptocurrency-friendly promises during the campaign. Many US states have begun to explore the possibility of establishing a strategic Bitcoin reserve. For example, Texas proposed a legislation on December 12 to establish a strategic Bitcoin reserve by accepting taxes, fees and donations in the form of Bitcoin, and holding these Bitcoins for at least 5 years. Texas' proposal may pave the way for the future national strategic Bitcoin reserve plan in the United States. Other states have followed suit. In addition, the Fed's interest rate cut cycle and the continued hoarding of Bitcoin by institutions have also become the driving force for the rise of Bitcoin.
3: Institutional participation: Spot ETFs and the coin hoarding craze, the beginning of a global cryptocurrency reserve competition
Spot ETF (Exchange Traded Fund) is different from previous futures ETFs. It directly holds actual Bitcoin, providing a convenient and safe Bitcoin investment tool for traditional financial institutions and ordinary investors. Since the approval of ETFs in early 2024, liquidity has surged, improving the trading depth and stability of Bitcoin. The asset management companies behind ETFs need to hold a large amount of actual Bitcoin, resulting in a decrease in the amount of Bitcoin that can be circulated in the market, thereby exacerbating the imbalance between supply and demand. In 2024, in addition to the United States, similar ETF products have been listed in other regions: Europe, Canada and Asia, and investors in these regions are also accelerating their layout.
The increase in holdings by countries and institutions is undoubtedly the main source of this demand. In 2024, governments hold 2.5% of the total supply of Bitcoin.
As of the end of November 2024, North American listed miners alone have accumulated more than 73,000 Bitcoins
Looking back at US President Trump's statement during the campaign, "I hope Bitcoin will be mined, minted and manufactured in the United States," it sent a strong signal to global investors: the United States is committed to becoming an undisputed Bitcoin mining power. If the United States can fully implement policy support and effectively integrate energy and technological resources, its goal of "mining in the United States, minting in the United States, and the future belongs to the United States" may become the United States' strategic declaration in the field of global cryptocurrency in the Bitcoin era. It is not difficult to associate it with the development of AI. What we can predict is that in the future, computing power is productivity.
Monthly BTC production ratio of 16 listed mining companies
（https://pro.theminermag.com/overview/bitcoin-liquidation-public-mining）
In addition to the country, institutions such as BlackRock have made "big purchases", and hoarding coins is gradually becoming a new indicator of corporate asset allocation.
MicroStrategy's Bitcoin strategy has triggered imitations. According to BitcoinTreasuries data, about 144 companies currently hold Bitcoin on their balance sheets. Accounting standard changes are the focus: On November 16, 2024, the U.S. Financial Accounting Standards Board (FASB) officially implemented the new fair value accounting standards, allowing companies to report assets based on the fair market value of Bitcoin rather than the historical cost price. This change gives companies more flexible asset classification and management rights, greatly reduces the risk of holding coins, and provides institutional support for more companies to adopt Bitcoin.
MicroStrategy currently holds 439,000 bitcoins. The company will be included in the Nasdaq 100 Index on December 23 this year, becoming the first Bitcoin company to enter the index. Bitcoin mining company MARA Holdings may be the next.
Top 10 Largest Companies Holding the Most Bitcoin
Outlook 2025: Bitcoin’s Future Potential
Geoff Kendrick, global head of digital asset research at Standard Chartered Bank, predicted in his latest report that the rate at which institutional funds flow into Bitcoin will continue in 2025, or even exceed the level in 2024.
In terms of Bitcoin ETFs in the United States, Standard Chartered noted from the 13F documents submitted to the U.S. Securities and Exchange Commission (SEC) that pension funds currently hold only 1% of the total shares of nine new Bitcoin ETFs. However, with the relaxation of the regulatory environment after the Trump administration came to power, it will become easier for traditional financial institutions to invest in digital assets. If U.S. pension funds, a huge market with a total size of up to $40 trillion, allocate a small portion of their assets to Bitcoin, it is bound to have a huge boost to the price of the currency.
Strategic reserve funds are also a key driver of Bitcoin's upward price. Even if global foreign exchange reserve managers allocate only 1% of their funds to Bitcoin, the amount involved is very considerable. This potential inflow of funds, combined with increasing institutional recognition, will become an important driving factor in the development of the Bitcoin market.
2024 is just the beginning of the Bitcoin bull market, and Bitcoin's rise has just begun. If U.S. pension funds, global sovereign wealth funds (SWFs), or possible U.S. strategic reserve funds absorb Bitcoin faster, it is possible that Bitcoin will rise to around $200,000 by the end of 2025, becoming the peak of this cycle.
In the long run, Bitcoin not only has the potential to replace gold and become the world's largest reserve asset, but will also gradually be integrated into the diversified asset allocation of institutional investors and even become an important part of corporate financial strategies. This change will fundamentally reshape the global financial landscape and establish Bitcoin's core position in the new economic system.
The last “Mega cycle”: opportunities and challenges coexist
This bull run may be BTC’s last “Mega Cycle” with huge growth potential.
Macro perspective: Bitcoin represents the third capitalization medium in human financial history
Meso-level: It is the core index of Web3 digital economy
Micro level: Bitcoin is attracting the attention of traditional global capital and gradually integrating into the mainstream financial system along with the wave of compliance.
As Matrixport said, "The success in 2024 lays the foundation for a strong start in 2025." For investors, this is not only a highlight moment for Bitcoin, but also a capital feast that cannot be missed.
Many investors look back to the beginning of 2024 and lament that they failed to increase their investment efforts. This is the last "grassroots cycle" of BTC. Are you ready for the next round of BTC wave?
