In a historic year for cryptocurrency, Bitcoin has solidified its status as a mainstream financial instrument, with the approval of 11 exchange-traded funds (ETFs) in January marking one of the most successful debuts in history. The influx of institutional demand has pushed Bitcoin’s price to record highs, with professional buyers leading the charge.
Institutional Demand Drives Bitcoin’s Price Surge
The launch of Bitcoin-focused ETFs in January attracted over $113.5 billion by the end of the year, with institutional investors leading the rise in over-the-counter (OTC) transactions. Kraken exchange reported a 220% year-over-year increase in its OTC markets, with Tim Ogilvie, head of institutional at Kraken, stating that “OTC is going gangbusters right now.”
Publicly Traded Companies Embrace Bitcoin
By the end of 2024, institutional adoption had expanded beyond ETFs, with publicly traded companies embracing Bitcoin on their balance sheets. MicroStrategy, a pioneer in this approach, has amassed over 444,000 Bitcoin in its treasury since 2020. The company has submitted a proxy to the US Securities and Exchange Commission seeking shareholders’ approval to expand its Bitcoin purchases through 2025.
MicroStrategy Seeks to Expand Bitcoin Purchases
MicroStrategy has called a special shareholders’ meeting to gain approval to expand its equity-issuance plan and fund further Bitcoin purchases. The company plans to increase its authorized shares of Class A common stock and preferred stock, allowing it more flexibility in raising capital. MicroStrategy’s 21/21 Plan aims to purchase an additional $42 billion worth of Bitcoin over the next three years.
Crypto.com Launches US Institutional Custody Service
Crypto.com has launched an institutional cryptocurrency custody service in the US, providing custody solutions for US institutions and high-net-worth individuals. The service, called Crypto.com Custody Trust Company, is part of the company’s expansion efforts in North America.
Russia Bans Crypto Mining in 10 Regions
Russia has approved a ban on cryptocurrency mining in 10 regions for six years, starting January 1, 2025. The ban aims to balance energy consumption and the growth of the crypto industry, with seasonal restrictions imposed in certain regions to prevent energy shortages.
IRS Reaffirms Stance on Crypto Staking Taxes
The IRS has reaffirmed its stance that cryptocurrency staking rewards are taxable upon receipt, rejecting arguments from a lawsuit filed by Joshua and Jessica Jarrett. The case may set a significant precedent for how staking rewards are taxed in the US.
Source: Cointelegraph.com
