Year-end inventory of cryptocurrencies: After 15 years of existence, Bitcoin finally became a mainstream investment in 2024.

In 2024, the cryptocurrency market experienced significant changes, and it was also the year when Bitcoin moved towards mainstream investment. CoinMarketCap's data shows that the total market value of cryptocurrencies rose from $1.65 trillion at the beginning of the year to $3.7 trillion at one point. Bitcoin stood out, with its price rising from $37,700 in December of the previous year to $106,000. In addition to Bitcoin, the second-ranked cryptocurrency by market value, Ethereum, saw a nearly 50% increase in its value, rising to $3,373.01, with a total market value of $406.3 billion. The price of the stablecoin, ranked third by market value, remained around $1. The fourth-largest cryptocurrency, Ripple (XRP), saw an increase of over 250% throughout the year, with a price of about $2.17. Dogecoin, which Elon Musk promoted several times, also saw an increase of over 250% throughout the year, with a total market value reaching $463.6 billion, making it the seventh-largest cryptocurrency in the world. However, Bitcoin remains the undisputed leader in the market, with its dominant position in the cryptocurrency market continuing to strengthen this year. Its total market value accounts for more than half of the cryptocurrency market value, rising from 45.27% at the end of last year to 57%, indicating that more market liquidity is concentrated in the Bitcoin ecosystem. December 5th was a historic moment, as Bitcoin, which was born in 2009, saw its price soar from less than one cent to $100,000 after 5256 trading days. Its market value briefly surpassed $2 trillion, successfully becoming one of the world's most valuable assets. "The approval of ETFs," "halving," and "the US election" were the three key factors driving the market changes for Bitcoin throughout the year. The launch of Bitcoin spot ETFs introduced new regulatory pathways to the market, attracting the attention of institutional investors. The halving event of Bitcoin also played a role in pushing the price up, and this trend is expected to continue into 2025. Trump's election at the end of the year further ignited market sentiment, with Bitcoin rising steadily from $68,000 in early November to a peak of $106,000. Overall, Bitcoin's performance in 2024 was not only remarkable in terms of price but, with regulatory and investor support, it will also show new vitality in 2025. This article will review Bitcoin's trends this year and look ahead to next year. A Strong Start to the Year: Bitcoin Spot ETF Approved and Listed in the US On January 11th of this year, the US Securities and Exchange Commission (SEC) approved the first Bitcoin spot ETF, authorizing 11 ETFs to start trading, fulfilling the market's years of anticipation. On the first day of trading, the total trading value of the 11 US Bitcoin spot ETFs exceeded $3.5 billion. This move has brought Bitcoin closer to the traditional financial markets and institutions, as the approval of the Bitcoin spot ETF signals the official acceptance of Bitcoin into the mainstream US financial market. Major US financial institutions, including Blackstone and Fidelity, are involved in this. The latest disclosed holdings show that as of September 30, Goldman Sachs' holdings in Bitcoin spot ETFs exceeded $710 million, up from $410 million at the end of the previous quarter. As of the end of the second quarter, Morgan Stanley held a total of approximately $190 million in Bitcoin spot ETF assets. Since successfully listing and trading on the US stock market in January, the cumulative daily trading volume of all Bitcoin ETF products in the US stock market has exceeded $500 billion. As of the time of writing, the total net asset value of Bitcoin spot ETFs is $112.944 billion, with a historical cumulative net inflow of $37.009 billion. After the approval of the Bitcoin spot ETF, market investors naturally shifted their focus to Ethereum. The approval of the Ethereum spot ETF came even faster than expected. On May 24th, the Ethereum spot ETF was officially approved by the US SEC. The SEC approved the plans of the New York Stock Exchange, the Chicago Board Options Exchange (Cboe), and Nasdaq to list Ethereum spot ETFs, with 8 Ethereum spot ETF applications being approved, including those from BlackRock and Fidelity. Unlike the Bitcoin spot ETFs, the launch of the Ethereum spot ETF came at a time when market conditions were gloomy, with data performance being unremarkable and even showing long periods of net outflows exceeding net inflows. It was not until early November that there was a significant increase in net inflows, and market funds began flowing in crazily. As of December 9th, the total cumulative net inflow of the Ethereum spot ETF has risen to $1.41 billion. As of December 26th, the total net asset value of the Ethereum spot ETF is $12.29 billion. Good News Keeps Coming! Bitcoin Halving in the Second Quarter The so-called "four-year halving mechanism" means that starting from 2012, every four years, the mining reward in the Bitcoin network will be halved. Before 2011, miners would receive 50 rewards for each mined block, which was reduced to 25 in November 2012, 12.5 in July 2016, 6.25 in May 2020, and it will be reduced to 3.125 after April 20, 2024. If Bitcoin ETF funds increase the supply of funds, then the halving event reduces the supply of Bitcoin products. The halving event may be interpreted by the market as a signal of reduced supply, leading to expectations of a rise in Bitcoin prices. The halving event has always been a key event in the Bitcoin market, representing a technical milestone of reducing block rewards, and serving as an important catalyst for market sentiment and capital flow. The historical price trends since the halving day indicate significant differences in market performance during different halving cycles, reflecting the gradual maturation of the market and the complex interplay between supply and demand and market expectations. During the first halving cycle, the price of Bitcoin increased by 5315%, with a maximum drawdown of 85%; in the second halving cycle, it increased by 1336%, with a maximum drawdown of 83%; in the third halving cycle, the growth slowed to 569%, with a reduced maximum drawdown of 77%. This gradually smoothing fluctuation indicates that the expansion of the market and the increase in capital flow are buffering the diminishing returns effect caused by the halving. Trump's reelection sparks trading frenzyBitcoinSince Donald Trump won the U.S. election on November 5th, Bitcoin has entered a strong upward trend, breaking through the $80,000 and $90,000 thresholds on November 10th and November 13th, respectively. On November 20th, the Trump team is discussing whether to establish a new position in the White House specifically responsible for cryptocurrency policy, which would be the first position in the White House dedicated to cryptocurrency, highlighting the industry's influence on the new government. The next day, the price of Bitcoin soared past $98,000. On December 5th, Trump nominated Atkins, an official with a friendly attitude towards cryptocurrency, as the new chairman of the U.S. Securities and Exchange Commission. Atkins is expected to focus on reducing regulations on cryptocurrency and easing enforcement penalties. Subsequently, the price of Bitcoin skyrocketed, breaking through the $100,000 mark. The Blazing Market After Trump's Victory From public statements, Trump's goal is to make the U.S. a "Bitcoin superpower" and "global cryptocurrency capital." He plans to purchase 200,000 Bitcoins annually within five years, eventually establishing a national reserve of 1 million Bitcoins, accounting for about 5% of the total Bitcoin supply. He also envisions using cryptocurrency to solve the U.S.'s $35 trillion national debt. However, the Federal Reserve may become an obstacle on his cryptocurrency path. Federal Reserve Chairman Powell stated that the institution has no intention of participating in any government accumulation of large amounts of Bitcoin. He said, "We are not allowed to hold Bitcoin." Regarding the legal issue of holding Bitcoin, Powell stated, "This is something congress should consider, but we do not want the Federal Reserve to change the law." At the same time, in the last few days of 2024, Bitcoin's upward momentum is waning, as investors assess the remaining momentum brought by President-elect Trump's support for the cryptocurrency industry. Trump is advancing a promise to create a cryptocurrency-friendly environment in the U.S. and supports the idea of establishing a national Bitcoin reserve. Traders are watching to see if this reserve is feasible. In 2025, can Trump become the "Bitcoin President"? Over a month later, Trump will soon take office, and the big promises he made, will they all come true? Bitcoin in 2025 will depend more on Trump, as the cryptocurrency industry pushes the elected president to start his promised cryptocurrency policy reforms upon taking office next month and issuing executive orders to help tokens become mainstream. During his campaign, Trump promised to become the "cryptocurrency President" to attract funding from the cryptocurrency industry. The industry hopes he will fulfill this promise by establishing a Bitcoin reserve through executive orders, ensuring the industry can obtain banking services, and creating a cryptocurrency committee. Analysts are divided on whether Trump can use his executive power (possibly through the Treasury Department) to create the reserve or if legislation from congress is needed. However, Wall Street has begun to anticipate a new wave of investment once Trump officially takes office. Bernstein's analyst team recently released a forecast report stating that with Trump possibly increasing support for cryptocurrency development once he officially takes office, Bitcoin's price could reach $200,000 by the end of 2025. "We expect Bitcoin to eventually replace gold in the next ten years, becoming the primary 'store of value' asset in the new era and a permanent component of investment institutions' asset allocation and corporate financial management standards." Bernstein's Bitcoin price prediction aligns with the latest one from Standard Chartered Bank. Geoff Kendrick, Global Head of Digital Assets Research at Standard Chartered Bank, who accurately predicted that Bitcoin would hit $100,000 this year, recently stated that Bitcoin's price will reach $200,000 by the end of 2025. However, some analysts believe that Bitcoin's current bull run will peak on January 17th next year. Vetle Lunde, an analyst at cryptocurrency research firm K33, stated that based on historical data, the average time from when Bitcoin first reached its all-time high to the last time it reached a new high is 318 days. Since the first all-time high of this cycle occurred on March 5th, Bitcoin may reach a new high on January 17th, 2025. If Bitcoin does reach its peak in mid-January, it will be close to Trump's presidential inauguration on January 20th. Lunde believes that once Trump takes office, the hype surrounding Trump-related trading will come to an end, with Bitcoin being one of them. "Trump's election was a catalyst for Bitcoin's strong rebound in the fourth quarter, and the inauguration ceremony may naturally mark the end of this trend, as implementing Trump's policy promises will require going through political procedures."