The Year in Bitcoin: From ETFs to All-Time Highs

It was a year unlike any other Bitcoinfrom new technological advances and historic milestones to finding a home on Wall Street and being used as a political football in the US election.

Here’s a look at the year for the world’s biggest crypto.

Bitcoin ETFs, a decade in the making

For a decade, the Securities and Exchange Commission has said no to top asset managers who wanted to offer Bitcoin exchange-traded funds. the once elusive Bitcoin ETF— to customers in the United States. But sentiment changed when the world’s largest asset manager, BlackRock, filed with the SEC in June 2023 to acquire a Bitcoin ETF.

An ETF is an investment vehicle that allows buyers to gain exposure to an asset without directly buying or holding the asset. For example, gold ETFs have been around for a long time and provide investors with the convenience of investing in gold without the hassle of finding a place to safely store physical bullion or coins.

But the SEC has been wary of allowing such a thing for Bitcoin, repeatedly rejecting applications on the grounds that the crypto market can be easily manipulated.

Industry analysts thought BlackRock would jump in and lend its weight to what would eventually prompt the regulator to give the green light. Then it became known. On January 10, the SEC approved Bitcoin ETFs, with 10 trades the next day. Mom and pop retail investors in the US market finally have the opportunity to invest some money in Bitcoin without having to bother with cryptocurrency exchanges, wallets and seed phrases. It was huge, and it had a bigger impact than even the most optimistic Bitcoin proponents imagined.

All-time highs

No one, not even those whose job it is to analyze the ETF market, expected such panic after trading began. The money quickly hit the funds. Investors previously locked out of the world of crypto investing may suddenly be buying shares in exchanges that track the price of Bitcoin.

CoinGecko data shows that the asset was just over $73,000 in March.

But it was not an easy ride. Many macroeconomic factors – not to mention government confiscations and major crypto movements – have weighed on Bitcoin throughout the year.

Despite reaching an all-time high in March, the next few months were difficult for Bitcoin as geopolitical risks, particularly in the Middle East, caused investors to shy away from risk assets.

At one point, Bitcoin exceeded $60,000 due to rising tensions between Iran and Israel and missile strikes.

The German government led to further selling pressure sold out Hundreds of millions of dollars in Bitcoin were confiscated in June.

Then, in September, it finally happened: the Federal Reserve lowered interest rates by 50 basis pointsThe central bank cut rates for the first time since aggressively raising rates in 2022. The central bank raised interest rates to curb post-pandemic inflation.

High interest rates generally lead investors to take a “risk-on” approach, moving away from stocks and other risky assets such as crypto, and away from the relative safety of the US dollar.

The intersection of September and A next cut in November made the asset more attractive to investors and led to an increase in prices. “Risk-on” trading is back, and it’s helped push crypto assets to record highs outside of Bitcoin.

Next month, Bitcoin did what crypto hopefuls had been prophesying for years: an asset $100,000 mark After Donald Trump was re-elected as US president in early December for the first time in his 15-year history, investors are anticipating a more relaxed regulatory environment for digital assets.

Institutions and politics

Two things have caused the price of Bitcoin to rise: institutions and politics.

On November 5, Trump stunned the Electoral College and popular vote audience. The Republican candidate campaigned as the potential leader of Bitcoin-friendly America.

“I’m working on my plan to make the United States the crypto capital of the planet,” Trump said At the Bitcoin 2024 conference in Nashville in July, he promised to make the country a “Bitcoin superpower” if elected.

Analysts and industry watchers had expected Trump’s victory to boost the leading digital asset. Their predictions turned out to be accurate; Shortly after the announcement of the next president of the United States, the price of Bitcoin rose.

Less than a month after his victory, Bitcoin hit $103,679.

Conditions are favorable for the asset’s growth, at least in theory, as America now has a historically supportive crypto-supporting Congress, including Vice President-elect J.D. Vance, who supports digital assets and owns significant amounts of Bitcoin.

Robert F. Kennedy Jr., who will become the US Secretary of Health and Human Services said How Bitcoin Should Back the Dollar and National Security Adviser Michael Waltz Votes for Pro-Crypto Bills

A number of other Republicans and Trump supporters also favor pro-crypto policies. All eyes now a strategic Bitcoin reserveUS government plans to hold billions of bitcoins on balance sheet for years to come It will be confirmed when Trump takes the reins in January.

Spot ETFs have opened the door to traditional finance like fixing Goldman Sachs and the Morgan Stanley Investment in cryptocurrency through vehicles.

According to Michael Saylor, founder of MicroStrategy, 2024 was “year zero of institutional adoption.”

Companies bought bitcoin

Speaking of Sailor, the Bitcoin publisher’s company has been aggressively snapping up Bitcoin in 2024 — accelerating its purchases toward the end of the year.

The software firm’s stock hit an all-time high and its founder continued to beat the Bitcoin drum, talking about how the cryptocurrency could save the company.

The billionaire – whose company owns 444,462 bitcoins, worth an estimated $42 billion at the time of writing – even shared his Bitcoin adoption strategy with Microsoft’s board of directors. The company has decided not to buy Bitcoin – despite admitting that it has thought about the issue.

However, other small companies such as Japan MetaPlanet and such as US public companies Semler Scientific and the Cosmos is healthy He bought the asset as a hedge against inflation.

Halving happened

But it’s not just ETFs and institutional adoption that’s helping Bitcoin gain traction in 2024. One of the most anticipated events for Bitcoin happened this year as well: the Bitcoin Fork.

Baked into Bitcoin’s code, the event occurs every four years and aims to keep Bitcoin’s inflation rate in check. After each halving, the reward for successfully mining a Bitcoin block is halved, meaning fewer Bitcoins are now entering the system. This will continue until the mining reward is completely eliminated and Bitcoin reaches its fixed supply of 21 million coins.

But this partial change was different from the previous ones investors pressed him more than ever. Why? Again, time. The increased adoption and success of Bitcoin ETFs has led to more people expect this event to raise the price of the asset. After all, a decrease in demand and an increase in demand should lead to an increase in price.

Although the story was a little lower, the coin first hit an all-time high before halving in April.

Runes were one thing

This doubling brought something else: a short-term craze for new technical progress in the Bitcoin industry: rune.

Casey Rodarmor, the man behind Ordinals records – launched last year – created a new standard for creating tokens on the blockchain called Runes. The Runes protocol launched on the day Bitcoin halved, and it became known – for a while – that dog-themed meme coins were gaining popularity on the network and increase in value.

However, some in the community have complained about what rune mania has done to the largest and oldest crypto network: transaction fees went up as activity increases on the blockchain to issue new tokens.

However, even if it is just boring crazy in the eyes of some, the launch of Bitcoin has proven that there are more use cases to offer than just holding and hoping “the number will increase.”

Edited by Sebastian Sinclair