Bitcoin goes 'Santa Claus mode' as optimism grows for US reserve status

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Bitcoin goes 'Santa Claus mode' as optimism grows for US reserve status

crypto :: 2024-12-16 :: source - cointelegraph

By Brayden Lindrea

Bitcoin’s price rallied almost 5% on Dec. 15 to set a new all-time high above $106,000 amid speculation that it may become a United States reserve asset.

Bitcoin BTC $104,465 topped out at $106,554 but has since fallen slightly, TradingView data shows. Its previous high was $104,000, which was set on Dec. 5.

CK Zheng, chief investment officer of ZK Square, told Cointelegraph that Bitcoin has likely entered “Santa Claus mode,” as many investors fear missing out and look to allocate more capital into the asset class.

He predicted a Bitcoin price tag of $125,000 in early 2025 but warned a possible 30% correction could follow as most of the bullish news from the incoming Trump administration has been “priced in.”

A 30% correction from $125,000 would see Bitcoin retrace to around $87,500.

*Bitcoin’s change in price over the last 24 hours. Source: TradingView*

It comes as Strike founder and CEO Jack Mallers said US President-Elect Donald Trump could potentially issue an executive order designating Bitcoin as a reserve asset on his first day in office on Jan. 20.

“There’s potential to use a day-one executive order to purchase Bitcoin,” Mallers stated, adding:

“It wouldn't be the size and scale of 1 million coins but it would be a significant position."

Meanwhile, Satoshi Action Fund CEO Dennis Porter said a third Bitcoin reserve bill is in the works at the state level, though he didn’t say which state might follow Texas and Pennsylvania’s lead.

“We had Pennsylvania, and we had Texas. And now we have another state coming on board. And they sent me the draft. So I know it’s real,” he said during a Dec. 15 X Spaces.

Porter added he expects at least 10 states to introduce a Bitcoin reserve bill in total.

"Its not going to stop. We're going to see more and more of these bills come. At least 10, in my opinion."

Financial analysts are also tipping a 0.25% interest rate cut from the US Federal Reserve on Dec. 18, which could lift Bitcoin’s price even further in the coming months.

Another catalyst behind Bitcoin’s price surge may be one of the new rules by the Financial Accounting Standards Board, which enables institutions to record the value of their crypto assets more realistically. The rule will apply to fiscal years beginning after Dec. 15.

Bitcoin’s market sentiment is currently in the “Extreme Greed” zone at a score of 83 out of 100, according to the Crypto Fear and Greed Index.