Bitcoin Doubles Its Value – Market Info

The cryptocurrency market during the Christmas season primarily oscillated around a market capitalization of €3.2 to €3.4 trillion. Bitcoin’s dominance slightly declined over the past two weeks, currently standing at approximately 57.4%. According to the Fear & Greed Index, the market remains in the greed phase, with the index scoring 74 out of 100 points.

Source: Coinmarketcap

Bitcoin Doubles Its Value

Bitcoin, the largest and most well-known cryptocurrency on the market, more than doubled its value in 2024. Several factors contributed to Bitcoin’s significant appreciation over the past year, including the approval of spot Bitcoin ETFs, the easing of regulatory hurdles, and Donald Trump’s victory in the presidential elections.

Bitcoin entered 2024 with a value of around 43,000 US dollars and closed the year at approximately 93,500 dollars. However, a week before Christmas, Bitcoin reached its all-time high of over 108,000 dollars but has since entered a phase of mild correction, primarily due to profit-taking by investors.

The more than 115% appreciation of Bitcoin in 2024, along with a nearly 50% increase in the cryptocurrency Ethereum, caused the total market capitalization of the crypto market to reach 3.25 trillion dollars by the end of the year, according to the CoinMarketCap website.

Analysts, however, remain optimistic. Analysts from brokerage firm Bernstein, in their latest report, stated that they believe 100,000 dollars for Bitcoin is by no means the final milestone. According to them, Bitcoin could reach a cyclical peak of around 200,000 dollars by the end of this calendar year.

However, Bitcoin wasn’t the only one to experience massive growth. MicroStrategy, the software company that has become the largest Bitcoin holder in the world, saw its stock value almost quintuple in 2024. The company recently joined the Nasdaq-100 benchmark index and is considered a “proxy for Bitcoin,” meaning that the movement of Bitcoin is closely tied to the movement of the company’s stock. In addition to MicroStrategy, dozens of other companies began investing in BTC last year, allocating part of their cash reserves into Bitcoin. Source

Ethereum ETFs Are Waking Up

In December, net inflows into Ethereum ETFs surpassed 2.6 billion dollars as Ethereum-focused funds experienced a revival and began competing with popular Bitcoin ETFs in terms of inflows.

In November and December, Ethereum ETFs saw eight weeks of net inflows, setting a new record for these types of funds. However, Ethereum ETFs still lag significantly behind Bitcoin ETFs, which closed the past calendar year with net inflows of over 35 billion US dollars. Analysts, however, believe this could change in 2025, especially if there is a revival in the altcoin market, with Ethereum being the flagship cryptocurrency. Moreover, regulators’ decisions that allow these funds to stake acquired ETH and generate staking yields could further influence Ethereum ETFs.

The most successful Ethereum ETF of 2024 was the iShares Ethereum Trust (ETHA) fund from BlackRock, which saw net capital inflows of over 3.5 billion dollars in 2024. The second place went to Fidelity’s fund with net inflows of 1.5 billion dollars.

These inflows were partially offset by net outflows of more than 3.6 billion dollars from Grayscale’s fund, which was converted from a Trust to a spot ETF. A similar situation was observed with Bitcoin ETFs.

The continuous growth in network activity, including new innovations such as artificial intelligence agents and asset tokenization, could further drive the performance of Ethereum, which underperformed compared to other first-layer blockchains in 2024. However, according to the latest data, activity in the DeFi space is gradually increasing, indicating a rising interest among retail investors in cryptocurrencies. Asset management company VanEck even predicts that Ethereum’s price could reach as high as 6,000 dollars in the final quarter of this year. Source

IRS Delays Implementation of New Rules in the US

The Internal Revenue Service (IRS), responsible for collecting and managing tax revenues for the U.S. government, recently announced a temporary delay in implementing new reporting rules that would require a default accounting method for crypto transactions on centralized exchanges.

This change, which was originally set to take effect in 2024, would have forced investors to use the FIFO (First In, First Out) method to calculate capital gains unless they chose an alternative accounting method.

Under the FIFO method, the oldest assets are considered sold first, which could significantly increase capital gains for crypto investors. Critics, including Shehan Chandrasekera, head of the tax department at CoinTracker, expressed concerns that the immediate implementation of these rules could negatively impact investors during market rallies.

The IRS has now postponed the automatic application of the FIFO rule until December 31, 2025, allowing investors to maintain their own accounting records until that date. This extension provides brokers with ample time to adjust their systems to support various accounting methods, such as HIFO (Highest In, First Out) or the Specific Identification method.

The delay was announced following a wave of criticism that the industry and investors needed more time to prepare for the new requirements. The IRS stated that the goal of this delay is to ensure a smooth transition to the new regulatory measures. Source

Will Switzerland Form Bitcoin Reserves?

A proposal to amend the Swiss federal constitution was recently initiated, which would require the Swiss National Bank (SNB) to hold Bitcoin on its balance sheet. However, this proposal must first gather 100,000 signatures from the public by June 30, 2025.

The initiative is led by the Swiss Federal Chancellor, who has gained support from the nonprofit organization 2B4CH, backed by Yves Bennaïm, a well-known pro-Bitcoin activist. The proposal has also received backing from the vice president of mining and energy at Tether, the company currently operating the largest stablecoin in the market, with a market capitalization of 137 billion dollars.

The goal of the proposal is to amend Article 99 of the Swiss Constitution to allocate part of the Swiss National Bank’s reserves into Bitcoin alongside gold. Supporters argue that Bitcoin’s decentralized and deflationary properties could strengthen Switzerland’s financial resilience and sovereignty. If the initiative gathers enough signatures, it will be reviewed by the Federal Assembly, which will assess its validity and compliance with Swiss law. If approved and supported by enough signatures, Swiss citizens will vote on the proposal in a nationwide referendum.

Proponents see this move as a progressive step in line with Switzerland’s tradition of financial innovation. Critics, however, point out the risks associated with Bitcoin’s volatility and the potential threat to the country’s financial stability. If the initiative is approved, Switzerland would become one of the first countries to constitutionally include Bitcoin in its monetary policy. Source

Bitcoin as a Currency Stabilization Tool

The Syrian Center for Economic Research (SCER) has outlined an ambitious proposal to integrate Bitcoin into the financial system of this Middle Eastern country. On the last day of the past calendar year, Bam, the founder of the Arabic crypto channel Bitcoin 21, shared the SCER’s proposal on the social network X. The proposal aims to legitimize Bitcoin for various purposes, including trading and mining. It suggests a digital version of the Syrian pound backed by assets such as gold, the US dollar, and possibly Bitcoin.

By utilizing blockchain technology, SCER envisions achieving greater stability for the national currency and protecting citizens from the persistent economic challenges in the country. The plan also highlights the potential use of unused energy sources for environmentally sustainable BTC mining to modernize the country’s economy.

However, representatives from SCER have added that this initiative still faces significant challenges. According to the group, Syria’s recovery from the prolonged conflict, along with international sanctions and limited technological infrastructure, presents a massive challenge that will certainly not be easy. Furthermore, cryptocurrency adoption in the country remains minimal. Blockchain analytics firm Chainalysis noted that although Syrians have gained access to foreign crypto platforms, there is no evidence of widespread use of cryptocurrencies in the country. Additionally, concerns persist regarding the misuse of cryptocurrencies by extremist groups, as some factions are allegedly known to have used crypto to fund their activities in the past.

The proposal has also raised concerns that Syria could attempt to bypass sanctions through cryptocurrencies. However, SCER explained that its intentions are focused on economic recovery and innovation, not circumventing international laws. Furthermore, SCER operates independently from the government and relies on volunteers, including Syrian engineers, academics, and entrepreneurs, who support knowledge-sharing and dialogue about the economy, technology, and monetary policy in the country. Source

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