Pre-New Year's Gifts: Bitcoin Hits Historical High of $106,000
The price of Bitcoin exceeded a new historical high of $106,000 amid growing expectations of its inclusion in US reserve assets.
1-Day BTC/USDT Chart. Source: Cryptocurrency screener Cryptovizor
The price of the first cryptocurrency rose almost 5% in a day, reaching a historical high of $106,648 on December 16. The previous record of $104,088 was set on December 5.
Seasonal Growth and Possible Correction
According to CK Zheng, Chief Investment Officer of ZK Square, Bitcoin has entered the traditional phase of December's growth (Santa Claus rally) because many investors are increasing investment in this asset class, fearing missing out on the opportunity for income.
Zheng predicts that Bitcoin's price might reach $125,000 in early 2025, but warns of a subsequent correction of 30% (to below $90,000), as positive expectations from the new Trump administration are already priced in the asset's current value.
Executive Order and Legislative Initiatives
Founder and CEO of Strike Jack Mallers pointed to the probability of issuing an order to include Bitcoin in the US reserve assets on Donald Trump’s (Donald Trump) first day of presidency on January 20.
"There is a possibility to issue an order to purchase Bitcoin on the first day. The purchase volume would be significant, though not reaching 1 million Bitcoins," noted Mallers.
CEO of Satoshi Action Fund Dennis Porter reported the preparation of bills on Bitcoin's reserve status at the state level — after Texas and Pennsylvania implemented it. He estimates that similar initiatives may appear in at least 10 states.
Additional Growth Factors
- Analysts expect a 0.25% key rate cut by the Federal Reserve System on December 18, which will support Bitcoin's price growth in the coming months
- New Financial Accounting Standards Board (FASB) regulations, effective after December 15, will allow institutional investors to report the current market value of crypto assets instead of their purchase price
According to the Fear and Greed Index, market sentiment for Bitcoin is in the "extreme greed" zone with a score of 83 out of 100 points. Such a high index value was last observed on December 5, when Bitcoin broke the $100,000 mark.