Author: 1912212.eth, Foresight News
Recently, the price of Bitcoin has exceeded $93,000, setting a new record high and is just a stone's throw away from $100,000. The Google Trends chart shows that the popularity of Bitcoin has reached its highest point since 2021.
In addition, CryptoQuant CEO Ki Young Ju released data saying that Bitcoin retail-level (below US$100,000) trading volume hit a three-year high, which also indicates that retail investors are entering the market.
After Bitcoin's rise stagnated and began to fluctuate and consolidate, some market funds flowed into meme coins, while some altcoins still performed poorly.
In the future, what other catalysts will drive bull market prices upward?
MicroStrategy may be included in the S&P 500 index
The S&P 500 Index, also known as the S&P 500 Index, is a stock index compiled by Standard & Poor's that aims to reflect the performance of 500 listed companies in the United States. The constituent stocks of the S&P 500 Index are selected through a series of strict screening criteria, including market capitalization, liquidity, and profitability standards. The S&P 500 Index is one of the important indicators for global investors to measure the performance of the US stock market and the health of the US economy.
Its new accounting rules could lead to MSTR being included in the S&P 500 index, CCN reported.
If this comes true, not only will the company's importance in the U.S. stock market be enhanced, but its leading position in the industry and sustained profitability will also be widely recognized.
According to the latest MicroStrategy holdings report, it currently holds 331,200 BTC at a price of approximately $16.5 billion, with an average holding price of $49,874. Based on the $90,000 price of Bitcoin, MicroStrategy's Bitcoin holdings have a floating profit of over $13 billion.
MicroStrategy founder Michael Saylor is a staunch Bitcoin bull. According to crypto KOL Remo Uherek, MicroStrategy's latest purchase of 51,780 Bitcoins used the $21 billion it had previously raised through stock financing. After this purchase, it still has $15.3 billion available to buy Bitcoin. If it continues to increase its Bitcoin holdings at this rate, the funds can be used until the end of this year.
Based on this, MicroStrategy plans to privately place $1.75 billion of 0% convertible senior notes, due in 2029. These notes are unsecured and interest-free and can be converted into cash or stock. The proceeds will be used to purchase Bitcoin and for general corporate purposes.
Data shows that MSTR’s U.S. stock performance has been impressive, with returns exceeding 450% so far this year.
If MicroStrategy can enter the S&P 500, more qualified companies may be included in the index in the future, thereby gaining more attention and influence from traditional funds. This is undoubtedly a major positive for the crypto market.
Microsoft considers Bitcoin investment proposal
Microsoft listed the issues to be discussed at the next shareholder meeting in a Form A filing filed with the U.S. Securities and Exchange Commission (SEC) on October 24. One of the proposals suggested that the tech company should study Bitcoin to hedge against inflation and other macroeconomic influences. On October 30, Microsoft shareholders began a preliminary vote on whether the company should invest in Bitcoin.
The document also shows that Microsoft will vote on the issue of "Evaluation of Bitcoin Investment" at the shareholders' meeting on December 10. Although the board of directors has proposed to oppose this proposal, shareholders have different thoughts. Vanguard and BlackRock are currently the largest institutional shareholders of Microsoft, holding 8.95% and 7.30% of the shares respectively.
BlackRock is no stranger to the crypto world. Its Bitcoin spot ETF has a large amount of funds. In addition, its chairman Larry Fink is also a Bitcoin supporter. Another major shareholder, Vanguard Group, is opposed to this and only focuses on assets such as stocks, bonds and cash.
The voting results are currently difficult to predict, and the final answer may be revealed on December 10.
In the past two months, Japanese listed company Metaplanet, German listed company Samara Asset Group plc, US listed companies Solidion Technolog (battery material supplier), Unitronix, Semler Scientific, Genius Group Limited, Cosmos Health (healthcare group), etc. have successively included Bitcoin and other assets into their reserve assets.
If the vote is successfully passed, as a listed company with huge influence, it may influence and drive more listed companies to purchase Bitcoin.
The Fed may cut interest rates by 25 basis points in December
Crypto assets represented by Bitcoin are increasingly affected by macro factors, and the Federal Reserve’s interest rate cut policy still has a significant influence on the inflow of funds into crypto assets.
On November 15, Federal Reserve Chairman Powell said that due to the strong US economy, the Fed does not need to "rush" to lower interest rates, and the Fed will "watch carefully" to ensure that certain inflation indicators remain within an acceptable range. Powell reiterated that the Fed's policy interest rate path will depend on upcoming data and the evolution of the economic outlook. He said that inflation is approaching the Fed's 2% target, but has not yet reached it. The Fed will closely monitor core indicators of inflation for goods and services excluding housing, which have been declining over the past two years. "We expect these indicators to continue to fluctuate in the recent range, and the road to the Fed's 2% target will be bumpy at times. But we still believe that we are on the right track in terms of inflation.
That night, the monthly rate of U.S. retail sales in October was 0.4%, higher than the expected 0.3%, and the previous value was revised up from 0.4 to 0.8%. As U.S. consumers showed a continued willingness to consume, retail sales grew steadily in October. After the data was released, spot gold fell in the short term and then rose, with a short-term fluctuation of $6; the short-term gains of the U.S. dollar index expanded to more than 30 points. The unexpected retail sales data made traders cut their bets on the Fed's interest rate cut in 2025.
According to CME's "Fed Watch": The probability that the Fed will cut interest rates by 25 basis points by December is 61.9%, and the probability that the Fed will maintain the current interest rate unchanged is 38.1%.
Rick Rieder, BlackRock's chief information officer (CIO), said he still expects the FOMC to cut interest rates by 25 basis points in December. Rieder said the current federal funds rate target range of 4.5% to 4.75% is restrictive. After the December rate cut, the Fed is expected to pause rate cuts and the FOMC will evaluate the number and speed of rate cuts. By 2025, the Fed is expected to cut interest rates at least twice.
In addition, Goldman Sachs chief economist Hatzius still expects "the Fed to cut interest rates consecutively in December, January and March, and then cut interest rates once a quarter in June and September, but he believes that the FOMC may slow down the pace of rate cuts more quickly, possibly as early as the December or January meeting." However, unless the November employment or inflation report is unexpectedly strong, it is unlikely that the FOMC will skip a rate cut in December.
The next Fed meeting will be held on December 17-18.
summary
In addition to the above three catalysts, Gary, the chairman of the US SEC, who has always been criticized by the crypto industry for being too harsh, may also announce his resignation after Thanksgiving. Trump will also be inaugurated as the new US president in January next year. The future crypto regulatory policy may be more relaxed and friendly. Matt Hougan, chief investment officer of Bitwise, once said, "Every year, we survey hundreds of financial advisors and ask them what prevents them from investing in cryptocurrencies? Every year, they tell us that "regulatory issues" are the number one reason. This is one of the reasons why this election changed the rules of the game for cryptocurrencies. We will see a wave of institutional capital in the coming months.
It will be worth waiting to see how the market performs in the future.
