Author: Echo, MetaEra
It's time for the year-end review again. The market situation in 2024 was complex, with the approval of the Bitcoin spot ETF, the halving event occurring as scheduled, the price soaring, the computing power reaching a new high, the ecosystem flourishing, and political changes... Many factors have driven a global investment frenzy in BTC, with the currency price hitting new highs and breaking through the $100,000 mark, with the Google Trends index more than doubling from last year, ushering in a glorious moment! For the entire crypto industry, 2024 was a landmark year. Each major event has carved out the trajectory of Bitcoin and the entire cryptocurrency market going forward.
This report, with time as the context and events as the nodes, MetaEra will review one by one the key moments that have influenced the direction of Bitcoin's fate. Let's walk into the 2024 Bitcoin chronicle and experience the glory and hardship of this year.
Crypto Floodgates Open: Bitcoin Spot ETF Approved
On January 10th, a landmark change came to the US financial stage - the BTC ETF was approved. This allowed US-listed companies, pension funds, and various institutional investors to openly enter this mysterious field through this financial instrument, ushering in a new era of publicly purchasing and holding Bitcoin.
In April, the Hong Kong subsidiaries of Huaxia, Bosera and Jiashi Funds' first Bitcoin and Ethereum spot ETF products were officially approved by the Hong Kong Securities and Regulatory Commission, and on April 30th, these highly anticipated products were officially listed on the Hong Kong Stock Exchange.
The market cheered the launch of the ETF, with the depth of crypto market products increasing and institutions flocking in, turning the previous skepticism into a pursuit of value storage, with traditional capital pouring into the crypto world, making crypto investment increasingly close to the Web 2.0 market.
In the short term after the news was released, the overall performance of the Bitcoin market was stable, with no significant volatility. Many questioned the sluggish performance of the ETF, with institutional conspiracy theories emerging, and the "all show, no substance" rhetoric echoing. All these uncertainties, like a magnet, have attracted the attention of countless investors and industry observers, becoming the most suspenseful chapter in Bitcoin's future development path. In the midst of the turbulent undercurrents, Bitcoin has steadfastly adhered to the "time machine theory", waiting for a new impetus, using time to prove its value.
Image source: SoSoValue
Bitcoin Halving: A Critical Turning Point
On April 20th, Bitcoin experienced a halving at block height 840,000, with the block reward dropping from 6.25 Bitcoin to 3.125 Bitcoin.
Normally, the price of BTC would rise after a halving, as the previous three halvings have without exception set new highs. Many investors also have the same expectation for the April 2024 halving, believing that this is undoubtedly a new driving force for the currency price after the ETF move.
However, looking at the price in the months after the halving, Bitcoin did not immediately set a new all-time high, but experienced a short-term correction before taking off, only after a series of events such as the halving, the conference, the political election, regulatory changes, and industry strategic reserves. From the halving mechanism and the history of past halvings, the halving has a large impact, often leading to market volatility and increased speculative activity in the crypto field; reshaping the mining landscape, with miner profitability declining; and stimulating technological innovation and community development within the blockchain ecosystem. The halving event may also help hedge against inflation and enhance the appeal of Bitcoin as a long-term investment asset.
The above information indicates that while the halving helps to strengthen the scarcity narrative of Bitcoin, macroeconomic factors can also have a significant impact on the Bitcoin price. This mysterious force, Bitcoin, cannot be accurately predicted based on history, as it is constantly refreshing people's perceptions at each stage, and we cannot stop its footsteps. As Binance CEO Richard Teng said: We need to take a longer-term view and look at market performance from a market cycle perspective. We should not be anxious about when the bull and bear markets will come, but focus on the long-term trends and fundamentals of the cryptocurrency market. Bitcoin always surprises us with its mythical gains in the midst of doubts, calm, and anxiety. We just need to wait, and Bitcoin will remain great.
BTC Ecosystem Infrastructure Providers: Miners, Strong Confidence vs. Survival Crisis?
From the miner's perspective, the Bitcoin mining landscape underwent dramatic changes in 2024. In addition to the economic roller coaster ride caused by the halving, the rise of new revenue sources such as transaction fees and Rune tokens quietly transformed the main source of miner income during the fourth Bitcoin halving period. According to statistics, since January 1, 2024, standard financial transactions accounted for 67% of total miner fee revenue, Runes for 19%, and BRC-20 and Ordinals transactions combined for 14%, with gas fee revenue steadily increasing.
Against this backdrop, the role of miners is undergoing a profound transformation. They are no longer simply block producers, but more like infrastructure service providers for the Bitcoin ecosystem. Leveraging the network resources and infrastructure advantages accumulated through mining, miners can provide services for various transactions and earn gas fees. This transformation has deeply integrated miners into all aspects of the Bitcoin ecosystem, and in the new economic model, they are exploring a more sustainable development path by closely linking their own fate with the entire ecosystem.
Bitcoin Conference: The Source of Market Rhythm
By mid-year, on July 27th, the Bitcoin 2024 Conference was held in Nashville, on a stage that gathered global attention, where well-known politicians such as Trump and Robert F. Kennedy Jr. took the stage, and their remarks and initiatives on Bitcoin sparked a wave of reactions in the conference venue and the entire cryptocurrency industry.
Trump delivered a nearly 1-hour speech, an hour later than originally scheduled, but the thousands of attendees in the audience remained enthusiastic. In his speech, Trump fully recognized Bitcoin's position as a scarce asset and a hedge asset, endorsed that Bitcoin will surpass gold to become the world's largest asset class in the future, and stated that the US must maintain its status as a cryptocurrency superpower. He also emphasized that if elected, he would fire SEC Chairman Gary Gensler, who has been obstructing the development of cryptocurrencies on the compliance front, on his first day in office, and made 13 commitments about cryptocurrencies:
● On my first day, I will fire Gary Gensler and appoint a new SEC chairman.
● If elected, establish a strategic national Bitcoin reserve for the US government.
● The US government will retain 100% of its Bitcoin.
● Bitcoin will fly to the Moon.
● Never sell your Bitcoin.
● Bitcoin may one day surpass the market cap of gold.
● I reaffirm my commitment to reducing Ross Ulbricht's sentence.
● There will never be a CBDC on my watch as President.
● Bitcoin and cryptocurrencies will soar like never before.
● Bitcoin does not threaten the US dollar, the current US government threatens the dollar.
● The United States will become the global capital of cryptocurrencies and the world's Bitcoin superpower.
● Bitcoin represents freedom, sovereignty and independence from government coercion and control.
● I assure the Bitcoin community that on the day I take office, Joe Biden and Kamala Harris' anti-cryptocurrency campaign will end.
Whether it was due to his personality or to get a laugh, he obviously improvised at the end: "Have fun, whether it's Bitcoin, cryptocurrencies, or anything else." Riding the momentum of the conference, he gave a big boost to his political blueprint.
It was like a star-studded political and financial feast. The market price performance during and after the Bitcoin conference sometimes soared lightly to new highs, and sometimes retreated briefly to gather strength. The conference was like a huge vortex of encrypted information, where all kinds of information about Bitcoin's technological innovation, policy interpretation, and market trends converged and then spread like ripples throughout the cryptocurrency field. The industry's views on politicians' statements and actions are also diverse, awaiting the test of time.
Bullish Outlook: Positive Impact of the US Election
On November 6, 14:27, the dust settled on the US presidential election, and Trump emerged as the final winner, with the 78-year-old returning to the White House with the support of the crypto power.
Trump's victory and the subsequent series of measures favorable to the crypto industry have had a remarkably positive impact on the Bitcoin price. After the election result was confirmed, the Bitcoin market was the first to respond, and investors, based on strong expectations of future policy benefits, flocked to the market.
After taking office, he announced that he would take a number of measures favorable to the crypto industry, including plans to repeal the SAB 121 Act on January 20 next year, clearing the way for traditional financial institutions to enter the market and promote the institutionalization of crypto assets, allowing a large amount of potential funds to have a legal and compliant channel to flow into the Bitcoin market, which will expand the market capacity and depth of Bitcoin; following the promise made at the Bitcoin conference, he plans to dismiss the current SEC chairman on his first day in office and appoint the crypto-friendly Paul Atkins as the next SEC chairman, sending a strong signal of regulatory relaxation to the market, boosting investor confidence; promote the establishment of a strategic Bitcoin reserve, influencing the market from the supply-demand relationship, retaining Bitcoin ownership and expanding scale, reducing the selling pressure in the market, while increasing its attractiveness as a strategic asset; plan to stop government Bitcoin sales and use Bitcoin as an investment and holding asset; his company is also negotiating with Intercontinental Exchange to acquire the cryptocurrency exchange Bakkt, which will also inject new vitality and imagination into the Bitcoin trading ecosystem, attracting more investors to participate, indirectly helping the price to rise.
Bitcoin is riding this wave of US policy tailwind, striding rapidly on the upward trajectory of its price, and its future development space and potential, under the interweaving of these positive factors, appear increasingly boundless. Welcome to the new era of cryptocurrencies under the boost of Trump!
New Political Landscape: Core Political Figures Speak Out, Government Reserves Enter the Fray
Driven by the historic market rally, some countries are considering establishing national Bitcoin reserves, and we are pleased to witness a significant trend: more and more political figures are beginning to recognize its value.
US President-elect Trump said he would turn the US into the world's cryptocurrency capital, proposing not to sell the US government's Bitcoin holdings, but to hold them as a strategic reserve asset.
Russian President Putin signed a digital currency taxation law, stipulating that digital currencies are property, applicable to foreign trade payments, mining and sales are exempt from value-added tax, mining infrastructure operators must report to the tax authorities, and personal income tax is levied on physical income; Putin also emphasized at the forum that no one can ban Bitcoin and other electronic payment methods, as they are new technologies that will continue to evolve.
Japanese Prime Minister Shigeru Ishiba: Reorganize the Web3 and Crypto Policy Department, the ruling Liberal Democratic Party will dissolve the existing Web3 project group and establish a dedicated department within the Digital Society Promotion Department, led by the former Web3 project group secretary-general, but the responsibilities of the new department are not yet clear.
The South Korean National Council passed the "Virtual Asset User Protection Act" enforcement decree, effective July 19, stipulating that virtual asset service providers must guarantee user deposits through banks, and have the right to suspend user cash and virtual asset deposits and withdrawals based on reasonable grounds.
Salvadoran President Nayib Bukele proposed to rent the country's volcanoes to miners for sustainable Bitcoin mining, using geothermal energy to reduce mining costs, after the country had already successfully mined about $46 million worth of Bitcoin using geothermal energy.
Argentine President Javier Milei advocates separating cryptocurrencies from state control, criticizing central bank digital currencies, advocating private management of cryptocurrencies, and warning against excessive government expansion.
The Monetary Authority of Singapore announced support for asset tokenization commercialization plans, convening financial institutions from multiple countries to conduct industry experiments, encouraging the development of industry standards to promote the commercialization and promotion of tokenized capital market products.
Suriname presidential candidate Maya Parbhoe promises that if elected in 2025, she will make Bitcoin the legal tender, gradually replacing the Surinamese dollar, plans to dissolve the central bank, reduce taxes, privatize public services, and use Bitcoin's transparency to fight corruption, calling Bitcoin the key to rebuilding the country's financial infrastructure.
Polish presidential candidate Sławomir Mentzen promises to establish a Bitcoin strategic reserve if elected.
The efforts and statements of these political figures foreshadow that Bitcoin will occupy an increasingly important position in the future financial landscape, steadily entering the grand vision of the global economic system, like a shining new star, attracting the attention of the political world.
Changing Regulatory Winds: Institutions Flock In
As the regulatory environment becomes more open and transparent by 2024, the crypto industry is entering a new era. In this wave, the "coin-stock dual cultivation" model is gradually becoming the new darling of listed companies, with many companies incorporating Bitcoin into their asset strategic reserves. Among them, Tesla and MicroStrategy can be considered the leaders, with their steadfast holding strategies reaping the "diamond hand victory", with MSTR's stock price soaring from around $194 to nearly $500 in just about a month, an increase of around 150%; in the Hong Kong stock market, the "Gemini Stars" Boyaa and Meitu, the two Bitcoin whales, are tied for the top spot, holding as many as 2,641 and 940 BTC respectively; the first crypto exchange stock Coinbase has a total Bitcoin profit of $804 million, with a price-earnings ratio of around 7.88.
This success has attracted more and more listed companies to follow suit. On November 19, Nano Labs Ltd (Nasdaq: NA) announced that it plans to allocate a portion of its remaining cash flow to Bitcoin, and will hold it as a long-term strategic reserve asset; on the same day, the US-listed company Genius Group Limited (GNS) announced that it has spent $10 million to buy 110 BTC, at an average price of $90,932; LQR House Inc. (LQR), a niche e-commerce platform focused on spirits and beverages, announced that its board of directors has approved the purchase of $1 million worth of Bitcoin as part of its capital management strategy; on November 20, the board of directors of Acurx Pharmaceuticals (ACXP), a US-listed biopharmaceutical company, approved the purchase of $1 million in Bitcoin as a reserve asset; on the same day, another US-listed company, Hoth Therapeutics (HOTH), announced that its board of directors had approved the purchase of up to $1 million in Bitcoin...
Image source: HOD L1 5 Capital
BTC Ecosystem: Hibernating in the Winter, Waiting for the Flowers to Bloom
The Bitcoin ecosystem is like an accelerated version of the crypto world, from the birth of the Ordinals protocol at the end of 2022, to the small bull market of Non-Fungible Tokens (NFTs) in early 2023, and then the brief bear market in the middle of 2023, everyone is active in various spaces chatting and envisioning the future, followed by the explosion of the BRC 20 which triggered the second small bull market. Entering the autumn of 2023, the market returned to silence, followed by the third high point at the beginning of 2024, and then it has been hibernating and brewing until now. In just two years, the entire crypto world has gone through three to four cycles of bull and bear markets.
Over the past year, Bitcoin's dominance in the market has increased significantly, from 45.27% to 56.81%, and its spot ETF holdings have grown substantially. A new market has fully opened up, with Bitcoin as the core asset, ETFs and US stocks as the channels for capital inflows, and US-listed companies as the carriers, highlighting the necessary development of its ecosystem and the improvement of capital efficiency. In terms of Layer 2, 77 projects have been active in the past three years, and in the first half of 2024, driven by the ETF boom, some old projects will see an increase in trading volume and token prices, and multiple solutions will emerge, with a total locked value of $3 billion, which is expected to grow significantly in the future. In the Layer 1 execution layer, new execution standards have emerged, and activity has steadily increased but the momentum has not been sustained. In other infrastructure, interoperability is mainly based on bridges and WBTC, and more solutions are expected to be launched; in the security layer, due to the potential threat of interoperability to asset security, related security solutions such as Bitcoin timestamping and staking protocols like Babylon have emerged, as well as new technologies like the Data Availability (DA) layer, such as Nubit, which have released the potential value of Bitcoin.
The Bitcoin ecosystem is currently still in a relatively disharmonious position. However, the situation has improved significantly compared to last year. The Bitcoin ecosystem will not miss the next bull market, and there are still many narratives to be explored in the Bitcoin ecosystem. The previous hibernation and precipitation have already accumulated enough strength. A large number of innovative projects are on the way.
Witness History: Bitcoin Breaks $100,000, Where to Next?
Around 10:30 am on December 5th, the BTC price once surged above $100,000, with a 24-hour increase of nearly 5%, meaning that Bitcoin has finally broken through the $100,000 mark as expected. At the same time, Ethereum broke through $3,800 USDT, with a 24-hour increase of 5.35%; SOL broke through $230 USDT, with the 24-hour decline narrowing to 2%.
Image source: OKX
The media effect triggered by Bitcoin's price breaking through $100,000 has already made Crypto and decentralization successfully enter the mainstream public's vision. It has made the public unable to help but review its past, from its initial insignificance to its current proud standing, its price rise like an epic tale. If counted from the iconic Pizza Day, it has gone through sixteen years of baptism.
It has gradually moved from the periphery to the center. When Bitcoin first broke through $1, perhaps many people did not expect it to have such amazing potential in the future; and when it crossed the important milestones of $100 and $1,000, the whole world was amazed. Now that it has broken through $100,000, it has pushed Bitcoin to a whole new height.
Finally, may Bitcoin continue to write miracles, and may we who believe in Bitcoin create miracles.
