Recent gains in Bitcoin are owed in part to changes in the political environment, particularly in the US. Incoming US President Donald Trump is backing cryptocurrencies, sparking renewed market optimism among investors.

From reforms in regulatory structures to a proposal for a national Bitcoin reserve, the policies he enforces provide Bitcoin an exceptional outlet for growth in an increasingly open and friendly new landscape. These changes places the US in a strategic position as the world’s leader in crypto innovation while giving a fertile ground for Bitcoin to continue growing.

Crypto On The Rise

These possible changes have been well taken by market participants, who have seen the highest market dominance of BTC at 59%. A bill being worked out may permit state-chartered banks to mint stablecoins without seeking prior approval from the Federal Reserve, putting the US in a very commanding position in the race to dominate financial innovation. Furthermore, proposals to deregulate the energy industry may favor crypto mining, which will place the US in a better position in the global race for blockchain.

🧐 Bitcoin’s flirtation with $100K continues as crypto’s top market cap has now reached an ATH of $99,850. As its price continues to hit round numbers and fulfill limit sell orders, it is widely being perceived as only a matter of time. pic.twitter.com/Qb1LTznuij

— Santiment (@santimentfeed) November 22, 2024

Historic Rally: BTC Approaching $100K

Bitcoin is trading at nearly $99,850 and is on the verge of the long-awaited $100,000 milestone. Similar to other bull runs, including the one witnessed after the elections in 2020, when the price of Bitcoin nearly doubled in a matter of a few months, some believe institutional interest coupled with friendly economic conditions and increased on-chain activity are the drivers of this phenomenal appreciation of the price of Bitcoin.

Source: VanEck

According to VanEck’s latest report, Bitcoin still is in its early stages of the rally, and there is minimal technical resistance in its way. With investor enthusiasm building, growing calls for the alpha coin to be adopted as a strategic reserve, and with a supportive US government, this rally appears well-positioned to continue. Experts are optimistic that Bitcoin is going to push forward and hit new highs.

The Future Of Bitcoin: Cautious Optimism

Analysts, while acknowledging that momentum is strong, point out that the market may run too hot, and early signs in the development are a rise in funding rates and increased unrealized profits. However, even from this stage, long-term prospects appear bright given strong institutional demand, solid on-chain metrics, and supportive regulatory changes, according to the forecast of $180,000 by VanEck for Bitcoin in the current cycle.

While historical data may indicate the crypto asset’s growth is decelerating as the markets mature, the cryptocurrency still shows hopeful prospects in the near term. So far, this rally displays the confidence of investors and has incrementally acquired recognition regarding Bitcoin’s role in a changed financial sector.

Featured image from CNBC, chart from TradingView

All eyes are on Bitcoin, especially as many traders continue to anticipate a break above the $100,000 mark. This anticipation has cascaded into a spike in activity, especially among Bitcoin whales. Interestingly, Bitcoin whales are making bold statements amidst the anticipation, with on-chain data pointing to an accumulation of over 40,000 BTC in just 96 hours among this holder cohort.

This interesting accumulation coincides with the Bitcoin price reaching a peak of $99,645 in the last 24 hours, adding further momentum to the narrative of a possible historic price milestone.

Examining The Holding Patterns Of Bitcoin Whales

Bitcoin’s recent price dynamics have put the spotlight on Bitcoin whales. Ali Martinez, a well-known cryptocurrency analyst, drew attention to the remarkable activity of Bitcoin whales on social media platform X.

While highlighting Santiment data, Martinez revealed that Bitcoin whales have bought over 40,000 BTC worth approximately $3.96 billion in the past 96 hours. Notably, the Bitcoin whales referred to in this metric by Santiment consist of addresses holding between 100 and 1,000 BTC. 

This aggressive accumulation comes at a critical juncture for Bitcoin, with prices flirting near the much-anticipated $100,000 mark. Such whale activity typically reduces the available supply of Bitcoin on the open market, which is expected to keep pushing up the Bitcoin price.

Despite the increase in whale accumulation, on-chain data from Glassnode suggests that long-term holders have upped their profit-taking in tandem. Particularly, over 128,000 BTC has been sold by long-term holders since early October.

However, this long-term holder profit taking has so far been offset by the demand from US Spot Bitcoin ETFs. These ETFs have acted as a counterbalance, absorbing nearly 90% of the Bitcoin sold by long-term holders.

A possible explanation is that long-term holders are exiting their self-custody of Bitcoin and are instead diverting their holdings into Spot Bitcoin ETFs in order to benefit from their regulatory clarity. According to data from SoSoValue, Spot Bitcoin ETFs in the US witnessed consecutive days of inflows throughout last week to bring the total inflow to $3.38 billion, which is the largest weekly inflow since their launch in January 2024. 

What’s Next For Bitcoin Price?

Looking ahead, the Bitcoin price is definitely on its way to break above $100,000 in the next few days. However, it remains to be seen what happens after that. Crypto analyst Tony Severino has speculated that the Bitcoin price peak could double within a timeframe of two weeks to two months following the break above $100,000.This prediction is based off of the Bitcoin price performance after it first broke above the $10,000 price level in 2017. 

On the other hand, veteran analyst Peter Brandt suggests there could be some sort of selling pressure among bulls once the Bitcoin price breaks above $100,000. 

“What I had in mind here is the possibility that bulls will sell their BTC sub $100,00 thinking they will buy a correction that does not come, then turn bearish if Bitcoin goes to $120,000 believing price must come down,” he said.

Nevertheless, the current crypto market landscape is set in place for a continued Bitcoin price increase in the next few weeks and months.

Featured image from DALL-E, chart from TradingView

US Senator Cynthia Lummis of Wyoming is doubling down on her efforts to legitimize Bitcoin and possibly add this digital asset to the country’s reserves.

In a November 21st interview, Lummis suggested that the US Federal Reserve sell some of its gold reserves to invest in the crypto. The Wyoming senator shared that the proceeds from selling a portion of gold reserves, valued at 1970 prices, can boost the US dollar and reduce the country’s growing debt.

Lummis’ announcement comes as BTC hit another all-time high and nears the $100k milestone. By pursuing a Bitcoin policy, the Federal Reserve can also benefit from higher returns.

Bitcoin is a “gold standard in digital assets, and setting up a strategic reserve can help the country’s financial strategy.

Lummis Says A BTC Reserve Can Boost USD, Reduce Debt

Lummis is one of the most outspoken supporters of Bitcoin and cryptocurrencies and pushed for the Bitcoin bill in the Senate. As a long-time crypto holder and supporter, the senator admitted owning five BTCs and putting them in a trust.

The lawmaker said that the government can adopt this strategy, start a crypto reserve, and hold these assets for at least two decades.

Explained: 🇺🇸 The Strategic Bitcoin Reserve

Breaking down the BITCOIN act — the bill introduced by Senator @CynthiaMLummis

– Buy 1m BTC over five years
– HODL for 20 years
– Proof of Reserves
– Protect Bitcoin property rights

TL;DR: 🚀🚀🚀 pic.twitter.com/snnWP59FBc

— Julian Fahrer (@Julian__Fahrer) November 19, 2024

Lummis admitted that she met with incoming US President Donald Trump about the Bitcoin proposal. Under the newest Lummis plan, the gold certificates held at a dozen Federal Reserve banks can be converted to their current fair market value. The proceeds from the sale of the certificates, pegged at 1970s prices, can be used to buy BTC.

A Look At The Proposed US Bitcoin Reserve

The planned Bitcoin strategic fund combines some long-term investment phases carried out over several years. The Treasury purchases 200k Bitcoin yearly under the Bitcoin Act 2024 for five years with at least retaining the digital assets for 20 years.

BTCUSD trading at $97,500 on the daily chart: TradingView.com

To ensure fairness and transparency, the government shall implement a Proof of Reserve System, where the government will publish audited quarterly reports. If other agencies have BTC holdings, these will be consolidated under the proposed Strategic Reserve.

A provision is also for the usage of the reserved BTC as a safe financial mechanism that will enable the agencies to use BTC as long-term assets. Moreover, the government will establish a decentralized storage network that can protect the assets against vulnerabilities and risks.

Image: Reddit

Some Critics Question The Lummis Plan

Like most financial policies, the Lummis plan has its critics. According to Avik Roy of the Foundation for Research on Equal Opportunity (FREOPP), Lummis’ suggestion to create a Bitcoin reserve will not necessarily help the country solve its debt woes.

In a speech at the North American Blockchain Summit 2024, Roy argued that the Lummis plan cannot cover the growing debt, which is now at $35 trillion.

Roy shared that a BTC reserve will be a welcome move, but the government must still implement budget reports to address the $2 trillion annual deficit. He also raised the possibility that the country may abandon its BTC reserves in the future, similar to gold’s experience in the 1970s.

Featured image from ZeroCap, chart from TradingView