The Bitcoin rally is losing steam in the final days of a year marked by significant price fluctuations for the digital asset. Investors are evaluating the potential impact of President-elect Donald Trump’s pro-crypto stance on the market’s future trajectory.
As of Friday morning in Singapore, Bitcoin was trading at $95,600, reflecting a nearly 3% decline from the previous day. Other cryptocurrencies, including Ether and Dogecoin, also experienced a slowdown in momentum. This pullback comes as President-elect Trump reiterates his commitment to fostering a crypto-friendly regulatory environment in the US, including exploring the possibility of a national Bitcoin reserve. Market participants are keenly observing the feasibility and potential implications of such a reserve.
Adding to the current market uncertainty is the expiration of a large volume of Bitcoin and Ether options contracts on Friday. FalconX, a prime broker, highlights this event as one of the largest options expiries in the history of digital assets. Sean McNulty, director of trading at liquidity provider Arbelos Markets, cautioned about the potential for market volatility surrounding this significant derivatives expiry.
Despite MicroStrategy Inc.’s recent indication of potentially increasing its Bitcoin holdings, the market remains hesitant. The company, which has amassed over $40 billion in Bitcoin, has effectively transitioned from a software firm to a major Bitcoin investor. This substantial investment underscores institutional interest in the cryptocurrency, yet hasn’t been enough to prevent the current price dip.
Data compiled by Bloomberg reveals that Bitcoin is on track for its first monthly decline in four, potentially closing December in the red. This follows Bitcoin’s all-time high of $108,316 reached on December 17th, highlighting the asset’s characteristic volatility. The final days of 2024 will be crucial in determining whether Bitcoin can regain its upward momentum or if the current consolidation will persist into the new year. The interplay between regulatory developments under the incoming Trump administration and broader market dynamics will likely shape the cryptocurrency’s trajectory in the coming months.
