Last week, the price of Bit reached a new high by breaking through $104,000. However, it soon dropped by about $13,000 and adjusted to the early $90,000s. It then rebounded over the weekend and is now fluctuating around $100,000.
The reason the Bit price was able to surpass the symbolic $100,000 mark was due to two consecutive positive developments. On the 5th, President-elect Donald Trump nominated Paul Atkins, a pro-Crypto.com figure, to the key position of Securities and Exchange Commission (SEC) chairman.
Atkins has previously criticized the SEC's Ripple (XRP) securities lawsuit. Gary Gensler, the chairman who has been constantly troubling the Crypto.com industry, is leaving, and a new industry-friendly figure is coming in.
Another positive development was the unexpected remarks of the Chairman of the US Federal Reserve (Fed). In an interview on the 5th, Fed Chairman Jerome Powell said "Bit is a competitor to gold, not the dollar," describing it as a "digital gold-like entity".
In its recently published Q4 2024 Treasury Issuance Outlook report, the US Treasury officially used the expression 'Bit = digital gold', drawing attention. Russia, which has been strongly regulating Crypto.com transactions, is also set to ease Bit regulations. Russian President Vladimir Putin said on the 4th that "Bit cannot be stopped".
On the 6th, David Sacks, a former PayPal COO, was appointed as the White House's AI and Crypto.com special advisor, known as the 'Crypto.com Czar' of the Trump administration. Sacks is a founding member of the fintech company PayPal and has considerable experience investing in the Crypto.com field through MultiCoin Capital.
Growing selling pressure as Bit exceeds $100,000
The symbolic event of Bit breaking through $100,000 was made possible by these major positive developments. BlackRock's Bit spot ETF (IBIT), which leads the US Bit spot ETF market, has secured over 500,000 Bit, more than the founder Satoshi Nakamoto. So, can Bit price aim to rise further to $110,000 now that it has broken through $100,000?
Investment experts' opinions are divided. First, on-chain indicators suggest more downside than upside. A representative indicator is the Bit NUPL (Net Unrealized Profit/Loss). According to Glassnode data, the NUPL recorded 0.59 last week, reflecting a market sentiment where many investors are currently in profit and can realize their gains at any time.
Entities with clear selling intentions have also started to move. On the 2nd, the US government transferred 96 million dollars worth of Bit to the Crypto.com exchange Coinbase, which can be cashed out at any time through Coinbase.
On the 5th, the bankrupt Crypto.com exchange Mt. Gox moved about 24,000 (worth $243 million) of the Bit it owes to creditors to a new wallet. It is unclear whether this is for creditor repayment or internal wallet reorganization, but if the former, it could also put selling pressure on the market.
The rise in Ethereum is a bit more optimistic compared to Bit. Ethereum price has surged about 44% in the last month, reaching a 3-year high. Last week, $428 million flowed into the US Ethereum ETF in a single day.
Will Microsoft decide to invest in Bit?
The 'Trump trade' in Crypto.com can be broadly divided into two categories: the news of Crypto.com-friendly figures being appointed under the Trump administration, and the expectations related to Trump's Crypto.com policy promotion.
After Trump's election, the Bit price has risen by about 40%, and policy-related aspects have largely been reflected in the price. The personnel-related parts, such as the 'Crypto.com Czar' and the SEC chairman nomination, have also been announced.
So, have most of the Crypto.com positive news been exhausted by the end of the year? Not necessarily. Whether US-listed companies will recognize Crypto.com as an investment asset is still pending. A representative case is the Microsoft shareholder meeting on the 10th (Tuesday), where the decision on Bit investment will be voted on.
Other companies may also have related schedules. The National Center for Public Policy Research, a think tank in Washington, DC, has recently submitted a proposal to Amazon to consider adopting Bit investment, as the current CPI-predicted inflation rate is 4.95%, and Bit should be purchased to hedge against the decline in cash value.
Key macroeconomic indicators to watch this week are the release of the US November CPI on the 11th (Wednesday) night and the US November PPI (Producer Price Index) in December. I wish all readers successful investments this week.
