Bitcoin – Imminent Tsunami – Cointribune

Bitcoin rose by 120% in 2024, far surpassing other major asset classes. 2025 is shaping up to be just as exceptional a year.

2025, the pivotal year?

This is the second consecutive year it has outperformed the S&P 500 (25%) and the Nasdaq (29%). It had already soared by 157% in 2023, compared to 26% for the S&P 500 and 45% for the Nasdaq. U.S. stocks are undeniably very dynamic, but their returns remain pale compared to those of bitcoin. This 120% places bitcoin in 8th place in the annual ranking, behind Microstrategy, Nvidia, and Palantir.

This annual return is less than that of the third year of the previous three cycles (189%, 124%, 308%). The cycles are four years long, marked by halvings. Nothing unusual here; the heavier bitcoin becomes, the slower the appreciation rate will be; it’s mathematical.

2024 was a good vintage thanks to ETFs and the electoral victory of pro-bitcoin candidate Donald Trump. Republicans took it all. White House, Senate, and House of Representatives. It is thus not surprising that bitcoin appreciated by 47% in the fourth quarter.

Regarding ETFs, note that they absorbed $16.5 billion during this quarter. Knowing that $15.8 billion went to BlackRock and $1.9 billion to Fidelity, the other ETFs are sharing the crumbs.

The net inflows into Bitcoin ETFs were $44 billion globally for the entire year of 2024. This is much, much more than for gold-backed ETFs, which have been stagnant.

1,000,000 bitcoins

The American election was undoubtedly the highlight of 2024. Donald Trump is explicitly pro-bitcoin, as are many members of his government.

Starting with Elon Musk and Robert Kennedy, who, like Senator Cynthia Lummis, proposes to accumulate a million bitcoins. The recent visit of Michael Saylor to Donald Trump’s estate in Florida is also a very good omen.

Some ministries are still vacant, but those that matter (Treasury, SEC, Commerce, Health, White House advisors, Vice President) all belong to pro-bitcoin individuals. This bodes well for appointments to the CFTC, OCC, and FDIC.

The inauguration will take place in just ten days, and even though a meeting with Vladimir Putin will be a priority, there are whispers that the American strategic reserve of bitcoins will be quickly decreed.

However, a decree can be easily revoked by the next president. A law such as the BITCOIN Act, supported by Senator Lummis, would be a more permanent solution. It will then need to go through Congress, but again, the signals are green according to Anthony Scaramucci.

The billionaire believes that there is a majority in the Senate in favor of a reserve of 750,000 BTC. The appointment of Senator Tim Scott to head the Senate banking committee is particularly promising:

Anyway, a decree would already eliminate the risk of the government selling the 198,100 BTC ($18 billion), without creating additional demand. Let’s recall that of this grand total, 119,754 BTC actually belongs to the exchange platform Bitfinex, the sister company of the stablecoin Tether.

The ideal scenario would be for the U.S. Congress to authorize the purchase of one million bitcoins. Nations around the world would then follow suit. The lines seem to already be moving in Germany:

Multinationals are diving in

MicroStrategy is and will continue to be a key driver of bitcoin’s rise. Michael Saylor announced in the fourth quarter that he would raise $42 billion to acquire more.

And while it was initially planned to acquire the equivalent of $10 billion in 2025, Microstrategy has already issued $16 billion in stock in the fourth quarter of 2024. It seems that Michael Saylor is well informed and decided to act before the U.S. government…

Other multinationals have joined the dance. In total, seventy publicly traded companies currently hold nearly $56 billion in bitcoins (including $42 billion for Microstrategy). These companies include MercadoLibre, Nexon, Genius Group, Semler Scientific, Metaplanet, and others.

This second wave of corporate adoption following that of 2021 (Tesla, Block, etc.) is gaining more and more momentum. And after Microsoft, it is now Meta that is under pressure to adopt the same strategy.

And since we are talking about institutional investors, note that the creditors of FTX are expected to receive $16 billion in cash (not in bitcoins) by the beginning of March. The bankruptcy plan took effect on January 3, and the lawyers in charge of the case agreed to repay creditors within 60 days, or by March 4.

These $16 billion represent as much as the total net inflows into ETFs during the fourth quarter. However, there is a good chance that a substantial portion of this money will be immediately converted into bitcoins.

Don’t miss our article: Bitcoin, what is the rational objective for 2025?

Nicolas T.

Bitcoin, geopolitical, economic and energy journalist.

DISCLAIMER

The views, thoughts, and opinions expressed in this article belong solely to the author, and should not be taken as investment advice. Do your own research before taking any investment decisions.