Article author: Echo, MetaEra
Source: MetaEra
It's that time of year again for year-end summaries. The market situation in 2024 is complex, with the approval of Bitcoin spot ETFs, the halving event arriving as scheduled, prices soaring, hash rates hitting new highs, ecosystems thriving, political storms changing, and continuous good news... Many factors are driving BTC to spark a global investment frenzy, with prices repeatedly hitting new highs, breaking the $100,000 mark, and the Google Trends index more than doubling from last year, ushering in a moment of brilliance! For the entire cryptocurrency industry, 2024 is a milestone year. Every major event is inscribed with the trajectory of Bitcoin and the entire cryptocurrency market's future progress.
This report traces the timeline, using events as nodes, and MetaEra will review those key moments that influence Bitcoin's fate. Let us step into the 2024 Bitcoin chronicle together, experiencing the glory and hardships of this year.
The moment of crypto unlocking: Bitcoin spot ETF approved.
On January 10, a milestone transformation occurred in the U.S. financial landscape — the approval of the BTC ETF. This allows U.S. listed companies, pension funds, and various institutional investors to legally enter this mysterious domain through this financial tool, ushering in a new era of publicly purchasing and holding Bitcoin.
In April, the first batch of spot ETF products for Bitcoin and Ethereum applied by the Hong Kong subsidiaries of Huaxia, Bosera, and Harvest Fund were officially approved by the Hong Kong Securities and Futures Commission. Subsequently, on April 30, these highly anticipated products were officially listed on the Hong Kong Stock Exchange.
The market cheers for the launch of the ETF, adding depth to cryptocurrency market products, with institutions entering en masse, jubilantly shifting past doubts to pursue value storage, with traditional capital pouring into the crypto world, making crypto investment increasingly close to the Web 2.0 market.
In the short term after the news broke, the overall performance of the Bitcoin market remained stable, and fluctuations did not occur. Many questioned the ETF's sluggish actions, with conspiracy theories abounding, and voices claiming 'all show, no substance' rising. All these uncertainties, like a magnet, attract countless investors and industry observers, becoming the most suspenseful chapter in Bitcoin's future development. Amidst the turbulent undercurrents, Bitcoin adheres to the 'time machine theory,' waiting for new momentum and proving its value over time.
Image source: SoSoValue
Bitcoin Halving: A Key Turning Point of Destiny
On April 20, Bitcoin underwent halving at block height 840,000, reducing the block reward from 6.25 BTC to 3.125 BTC.
Typically, Bitcoin's price tends to rise after a halving, as the previous three halvings have invariably set new highs. Many investors are similarly optimistic about the upcoming halving in April 2024, believing it will undoubtedly provide new momentum for price increases following the ETF actions.
However, looking at the price months after the halving, Bitcoin experienced a brief pullback before not immediately reaching new historical highs. Instead, after a series of events including the halving, the conference, political elections, regulatory shifts, and industry strategic reserves, it spread its wings and significantly rose. From the halving mechanism and past halving history, the halving has a large impact, usually leading to market volatility and increased speculation in the cryptocurrency field; it reshapes the mining business model, reducing miners' profit points; it stimulates technological innovation and community development within the blockchain ecosystem. The halving event may also hedge against inflation, enhancing Bitcoin's attractiveness as a long-term investment asset.
The above information indicates that while the halving helps strengthen Bitcoin's scarcity narrative, macroeconomic factors will also have a significant impact on Bitcoin's price. This mysterious force of Bitcoin cannot be accurately predicted based on history; each stage refreshes the world's understanding, and we cannot stop its progress. As Binance CEO Richard Teng said: we need to look further ahead and view market performance from the perspective of market cycles. We should not be anxious about when the bull or bear market will arrive but should focus on the long-term trends and fundamentals of the cryptocurrency market. Bitcoin always surprises with its mythical price increases during moments of questioning and cyclical calm and anxiety. We just need to wait; Bitcoin remains great.
BTC ecosystem basic service providers: miners, strong confidence vs survival crisis?
From the miners' perspective, the Bitcoin mining landscape in 2024 is changing rapidly. Not only has the halving reduced hash prices, creating an economic roller coaster, but the development of inscriptions and runes in the first half of the year has quietly changed miners' primary sources of income, akin to an ecological enlightenment. In the past, mining relied solely on traditional block rewards, but with these emerging phenomena sprouting up like mushrooms, the focus of earnings has gradually shifted to infrastructure service Gas fees. For instance, during Bitcoin's fourth halving, transaction fees surged dramatically, and Rune tokens paid significant fees at the halving block, becoming an important component of miners' revenues. Statistics show that since January 1, 2024, standard financial transactions account for 67% of the overall miner fee income, Runes account for 19%, and combined BRC-20 and Ordinals transactions account for 14%, with Gas fee income increasing daily.
Against this backdrop, the role of miners is undergoing a profound transformation. They are no longer merely simple block producers but more like infrastructure service providers in the Bitcoin ecosystem. With the network resources and infrastructure advantages accumulated from mining, miners can provide services for various transactions and earn Gas fees. This shift allows miners to deeply integrate into various aspects of the Bitcoin ecosystem, seeking a more sustainable development path under the new economic model while driving ecological development and closely linking their fate with the entire ecosystem.
Bitcoin Conference: The market dynamics originate here.
By mid-year, on July 27, the Bitcoin 2024 Conference was held in Nashville, where well-known politicians such as Trump and Robert F. Kennedy made appearances, and their statements and proposals regarding Bitcoin were like heavy bombs, creating ripples in the conference and throughout the cryptocurrency industry.
Trump delivered a nearly 1-hour speech, and despite starting an hour late, tens of thousands of attendees were still enthusiastic. In his speech, Trump fully acknowledged BTC as a scarce asset and a safe haven, agreeing that BTC will surpass gold to become the world's largest asset class, stating that the U.S. must maintain its status as a cryptocurrency superpower. He also emphasized that if elected, he would fire SEC Chairman Gray Gensler on his first day in office for hindering the development of cryptocurrency through compliance measures, and made 13 major commitments regarding cryptocurrency:
● On the first day, I will fire Gary Gensler and appoint a new SEC chair.
● If elected, I will establish a strategic national Bitcoin reserve for the U.S. government.
● The U.S. government will retain 100% of its holdings.
● Bitcoin will fly to the moon.
● Never sell your Bitcoin.
● Bitcoin may one day surpass the market value of gold.
● I reaffirm my commitment to lighten Ross Ulbricht's sentence.
● There will never be a CBDC while I am president of the United States if elected.
● Bitcoin and cryptocurrencies will soar in unprecedented ways.
● Bitcoin does not threaten the U.S. dollar; the current U.S. government is the threat to the dollar.
● The United States will become the global cryptocurrency capital and the world's Bitcoin superpower.
● Bitcoin represents freedom, sovereignty, and independence from government coercion and control.
● I assure the Bitcoin community that on the day I am inaugurated, the anti-cryptocurrency campaign of Joe Biden and Kamala Harris will end.
Whether due to his personality or to amuse the audience, he clearly improvised at the end: 'I wish everyone fun, whether it's with Bitcoin, cryptocurrencies, or anything else.' Taking advantage of the conference's momentum, he garnered significant support for his political blueprint.
It was like a star-studded political and financial feast. The market price performance during and after the Bitcoin conference occasionally leapt to new heights and then briefly corrected, gathering strength. The conference acted like a massive vortex of crypto information, where various innovations, policy interpretations, and market trends concerning Bitcoin converged and then rippled out to the entire cryptocurrency field. Opinions and actions regarding politicians within the industry also varied widely, awaiting the test of time.
Bull Market Outlook: Positive Impact of the U.S. Election
On November 6 at 14:27, the dust settled on the U.S. presidential election, with Trump emerging as the final winner, returning to the White House at the age of 78 with the support of crypto forces.
Trump's victory and the subsequent series of measures favorable to the crypto industry have had a remarkably positive impact on Bitcoin's price. After the election results were determined, the Bitcoin market was the first to react, with investors flocking to the market based on strong expectations of favorable future policies.
After taking office, he announced multiple measures beneficial to the cryptocurrency industry, including plans to abolish the SAB 121 Act after assuming office on January 20, clearing the barriers for traditional financial institutions to enter and promoting the institutionalization of cryptocurrency assets, thus creating a legitimate and compliant channel for a large amount of potential funds to flow into the Bitcoin market, expanding Bitcoin's market capacity and capital depth; continuing the commitments made at the Bitcoin conference, intending to abolish the former SEC chairman and appoint crypto-friendly Paul Atkins as the next SEC chairman on the first day in office, sending a strong signal of regulatory relaxation to the market, greatly boosting investors' confidence; promoting the establishment of a strategic Bitcoin reserve, influencing the market from the supply-demand perspective, retaining Bitcoin ownership while expanding scale to reduce selling pressure on Bitcoin in the market, while increasing its attractiveness as a strategic asset; planning to stop government Bitcoin sales and use Bitcoin as an investment holding asset; and the companies under their purview are also negotiating with the Intercontinental Exchange about the potential acquisition of the cryptocurrency exchange Bakkt, injecting new vitality and imagination into Bitcoin's trading ecosystem, attracting more investors to participate and indirectly aiding in price increases.
Bitcoin is riding the wave of U.S. policy, charging forward on the price ascent track. Its future development space and potential seem increasingly vast under the intertwining of this series of positive factors. Welcome to the new era of cryptocurrency propelled by Trump!
New political landscape: Core political figures express varied opinions, government reserves enter the fray.
Driven by historic market surges, some countries are considering establishing national Bitcoin reserves, and we are pleased to witness a significant trend: more and more political figures are beginning to recognize its value.
The U.S. presumptive president Trump stated he would make the U.S. the world's cryptocurrency capital, proposing not to sell the Bitcoin held by the U.S. government, but to hold it as a strategic reserve asset for the long term.
Russian President Vladimir Putin signed a law on the taxation of digital currencies, defining digital currencies as property applicable to foreign trade payments, exempting mining and sales from value-added tax, requiring operators of mining infrastructure to report to tax authorities, and personal income tax to be levied based on actual income; Putin also emphasized at the forum that no one can prohibit Bitcoin and other electronic payment methods, as they are new technologies that will continue to develop.
Japanese Prime Minister Shigeru Ishiba: Reorganizing the Web3 and cryptocurrency policy departments, the ruling Liberal Democratic Party disbanded the current Web3 project team and established a dedicated department within the party's Digital Society Promotion Department, led by the former secretary of the Web3 project team, though the new department's responsibilities have yet to be defined.
The South Korean State Council passed the (Virtual Asset User Protection Act) enforcement order, effective July 19, requiring virtual asset service providers to safeguard user deposits through banks and allowing them to suspend user cash and virtual asset deposits for reasonable reasons.
Salvadoran President Nayib Bukele proposed renting the country's volcanoes to miners for sustainable Bitcoin mining, using geothermal energy to lower mining costs. Previously, the country successfully mined Bitcoin worth approximately $46 million using geothermal energy.
Argentine President Javier Milei advocates separating cryptocurrencies from state control, criticizing central bank digital currencies, promoting private management of cryptocurrencies, and warning against government overreach.
The Monetary Authority of Singapore announced support for the commercialization of asset tokenization plans, gathering multiple financial institutions to conduct industry trials and encourage the establishment of industry standards to promote the commercialization and promotion of tokenized capital market products.
Suriname presidential candidate Maya Parbhoe promised that if he wins in 2025, he will make Bitcoin legal tender, gradually replacing the Surinamese dollar, plans to dissolve the central bank, reduce taxes, privatize public services, and use Bitcoin's transparency to combat corruption, calling Bitcoin the key to rebuilding the nation's financial infrastructure.
Polish presidential candidate Sławomir Mentzen promised to establish a Bitcoin strategic reserve if elected.
The various efforts and statements from these political figures suggest that Bitcoin is poised to occupy a more pivotal position in the future financial landscape, steadily stepping into the grand vision of the global economic system, like a shining new star attracting the attention of the political world.
Regulatory winds shift: Institutions come flooding in
As the regulatory environment becomes more open and transparent in 2024, the cryptocurrency industry is entering a new era. Amid such a wave, the 'dual repair of coins and stocks' model is gradually becoming the new favorite of listed companies, with many enterprises incorporating Bitcoin into their asset strategic reserves. Among them, Tesla and MicroStrategy stand out, having reaped 'diamond hand victories' through their steadfast holding strategies, with MSTR's stock price soaring from around $194 to nearly $500 in just about a month, an increase of around 150%; the 'twin stars' of the Hong Kong stock market, Boya and Meitu, both Bitcoin whales, hold 2,641 and 940 BTC respectively; the first publicly traded cryptocurrency exchange Coinbase reported a total profit of $804 million, with a price-earning ratio of about 7.88 times.
Such effectiveness has attracted more listed companies to follow suit. On November 19, Nano Labs Ltd (Nasdaq: NA) announced plans to allocate part of its remaining cash flow to Bitcoin, to be held as a long-term strategic reserve asset; on the same day, U.S. listed company Genius Group Limited (GNS) announced it had spent $10 million to buy 110 BTC at an average price of $90,932; niche e-commerce platform focused on spirits and beverages, U.S. listed company LQR House Inc. (LQR) announced its board approved the purchase of $1 million worth of Bitcoin as part of its fund management strategy; on November 20, the board of U.S. listed biopharmaceutical company Acurx Pharmaceuticals (ACXP) approved the purchase of $1 million worth of Bitcoin as a reserve asset; on the same day, another U.S. listed company Hoth Therapeutics (HOTH) announced its board approved the purchase of up to $1 million worth of Bitcoin... It is evident that many listed companies have fully recognized the value storage function of BTC and its role in boosting stock prices, all joining this 'BTC Strategic Reserve Competition.'
Image source: HODL15Capital
BTC ecosystem: Dormant winter, waiting for flowers to bloom.
The Bitcoin ecosystem is like an accelerated version of the cryptocurrency circle, from the birth of the Ordinals protocol at the end of 2022, to the small peak of NFTs in early 2023, then to the brief bear market in mid-2023, where everyone was active in various spaces dreaming of the future. Subsequently, the BRC20 ignited the second mini-peak of the bull market. Entering the fall of 2023, the market returned to silence, followed by the third climax in early 2024, and has been dormant and brewing up to now. In just two years, it has completed the entire cycle of bull and bear markets over three to four decades.
Over the past year, Bitcoin's market dominance has significantly increased, rising from 45.27% to 56.81%, with a substantial growth in spot ETF holdings. A new market has fully opened, centered on Bitcoin as the core asset, with ETFs and U.S. stocks as the channels for capital inflow, showcasing the necessity of enhancing its developmental ecology and improving capital efficiency. Regarding Layer 2, 77 projects have taken action over the past three years; driven by the ETF wave, the trading volume and token prices of some old projects have risen in the first half of 2024, with various solutions emerging, totaling a locked value of $3 billion, which is expected to grow significantly in the future. New execution standards have appeared on the Layer 1 execution layer, and while activities had been steadily growing, the momentum has not continued. In other infrastructures, interoperability solutions like bridges and WBTC have become mainstream, with more solutions expected to be launched; in terms of security layers, interoperability may threaten asset security, and related security solutions like Babylon's Bitcoin timestamp and staking protocol have emerged, along with new technologies like the data availability layer (DA layer), such as Nubit, which have unlocked Bitcoin's potential value.
The Bitcoin ecosystem is still in a relatively disharmonious position. However, compared to last year, there has been significant progress. The Bitcoin ecosystem will not miss out on the raging bull market; there are still many narratives waiting to be uncovered. The previous dormancy and sedimentation have already accumulated enough power. A large number of innovative projects are on the way.
Witnessing history: Bitcoin first breaks $100,000, where to next?
Around 10:30 on December 5, BTC price surged over $100,000, with a 24-hour increase of nearly 5%, meaning Bitcoin has lived up to expectations by breaking the $100,000 mark for the first time. Meanwhile, Ethereum broke $3,800, with a 24-hour increase of 5.35%; SOL broke $230, with a 24-hour decrease narrowing to 2%.
Image source: OKX
The media effect triggered by Bitcoin's price breaking $100,000 has already brought Crypto and decentralization into the mainstream public eye. It compels the public to reflect on its past, from its humble beginnings to its current proud stature, with its price ascent resembling a grand and dramatic legend. If we start counting from that iconic Pizza Day, it has already undergone sixteen years of baptism.
It gradually moved from the margins to the center. When Bitcoin first broke the $1 mark, perhaps many did not anticipate its astonishing potential; and when it crossed significant thresholds like $100 and $1000, the whole world took notice. Now, breaking the $100,000 mark has pushed Bitcoin to an entirely new height.
Finally, I wish Bitcoin can continue to write miracles, and I hope that we who believe in Bitcoin can create miracles.
