- Bitcoin is hitting record highs and many investors expect this to continue
- A sum of economic and political factors is contributing to this trend
- Donald Trump is giving more specifics, emphasizing U.S. leadership in crypto
- Because of this, many expect even more inflows into U.S. crypto ETFs
- Tom Lee has so far proven to be right in his predictions, and further ones are also optimistic
- Some investors believe that this will allow Bitcoin to reach $933K.
- Michael Sailor proposes a radical strategy for US dominance in Bitcoin
Bitcoin is showing record growth, and several factors that have come together in 2024 contribute to this to varying degrees. These include the expected halving effect, Donald Trump’s victory and his crypto initiatives, Bitcoin ETF launches, and more.
While some investors are waiting for the bull cycle to end, especially as Bitcoin growth starts to slow down, and are more focused on the altcoin market – others are of the opinion that there is still a long way to go and 2025 will be even more interesting.
Which of them will be right or none of them – time will tell, but let’s take a look at the arguments and numbers that make further Bitcoin growth potentially possible.
What Is Likely Happening With Bitcoin Right Now?
There is an opinion that BlackRock is suppressing prices in the cryptocurrency market and holding back Bitcoin from surging forward, having an obvious interest in doing so. Also, this opinion increasingly links BlackRock to Coinbase and Trump and signifies their interest too.
This opinion is based on the facts that BlackRock may be interested in keeping the price of Bitcoin low for as long as possible given their systematic purchases and confidence in the Bitcoin price going forward.
That said, BlackRock is partnered with the largest exchange in the US, Coinbase, which has faced lawsuits from the SEC and has generally been forced to operate in an environment unfavorable to crypto.
And that could change with the coming of Donald Trump, however, he needs his own interest in this and potentially has one. Donald Trump regardless of how much he truly believes in Bitcoin as an improvement to the economic system, may see it as a great investment.
We can see Donald Trump and the big whales buying up hundreds of millions of dollars worth of crypto for example recently the Trump Foundation bought $55M worth of Ether, $1M worth of AAVE, and $1M worth of LINK and that’s just the wallets we know.
We also see other big whales redeeming even more Bitcoin here’s one of them buying 1850 BTC worth $181M.
And even adding to that the fact that Wall Street is getting addicted to cryptocurrencies, we could be in for an artificial fall for the reasons mentioned above, as Tom Lee, whose predictions have been quite accurate up to this point, said in an interview with CNBC:
“There are a lot of folks who don’t want to see Bitcoin above $100K and maybe even the exchanges themselves are concerned because of the low supply of Bitcoin. So bi exchanges suppress the price of Bitcoin they want to keep it below $100K for as long as possible.”
Perhaps many crypto enthusiasts expected that the adoption of Bitcoin would not be accompanied by so much purely financial interest, but also a genuine desire to improve the financial system, and with it, to strengthen people’s rights and freedoms.
But so far, the potential desire of institutions and investors to enrich themselves has not prevented this from happening and probably drives it much more strongly than if it were based solely on cultural and technological provisions.
In particular, Donald Trump’s potential interest could lead to the creation of a national Bitcoin reserve, which in turn could set off a chain reaction.
What are the Main Assessments of Investors and Analysts Right Now?
Larry Fink recently told his investors that it makes sense to invest 2% of a portfolio in Bitcoin.
Given the number of assets under management at BlackRock this means that an additional $220B could be poured into Bitcoin, that’s four times more than the spot Bitcoin ETF IBIT. Given the bull market multiple of X118 this could increase Bitcoin’s market capitalization to almost $20T and the Bitcoin price would jump to $933K.
The key point here is the official recommendation from Blackrock of a two percent location in Bitcoin. This could turn out to be a bullish signal, imagine that all investment funds in the world including pension funds would put 2% of their capital into Bitcoin.
Here we can also revisit Tom Lee and his real thoughts on how he thinks 2025 will pan out for Bitcoin, he says that cryptocurrency prices will not be suppressed for long and are actually about to take off and Trump is a key figure in all of this:
“To put it simply, Trump-put is a white house administration that will measure its success by the state of the stock market but it is also a president who will get a second term and has significant experience gained from the previous one. The cabinet in this case will be well received by the private sector and will probably be focused on supporting the markets. Overall I think investors who have been cautious in the last few years will now want to take more risks next year.”
Trump-put is an analogy to options-put where it is implied that the Trump administration will support the stock market and take measures to prevent it from falling significantly. This may include decisions that stimulate growth in stocks such as tax cuts, deregulation, or other pro-business initiatives.
And by the way, recently Trump announced that he is going to cut taxes a lot. Said that he would cut corporate taxes from 21% to 15% but only for those companies that produce inside the US, and replace them with tariffs on companies that ship American jobs overseas. In addition, he’s probably going to eliminate all federal income taxes.
Separately, Trump has stated that he is going to exempt cryptocurrencies from capital gains taxes, but only those cryptocurrencies that are issued by U.S. companies.
This means that cryptocurrencies issued in the US are the most logical investments for US citizens because they will not have to pay up to 37% tax and these cryptocurrencies will be legal and regulated by the US.
Another additional pro-crypto statement that didn’t go viral online was when Donald Trump came to Wall Street to open trading on the New York Stock Exchange.
“Unlike the past administration you are very involved in cryptocurrencies you want to create for it something like a strategic oil reserve? Yes, I think yes we are going to do something great about cryptocurrencies because we don’t want China or anyone else but to get ahead of us we want to be leaders.”
All of this brings us back to Tom Lee and his predictions where he thinks Bitcoin will go much higher than anyone thinks his company has done the calculations and here is their target of $250K in 2025.
“We think it will follow the previous halving cycle which implies that around $250K for Bitcoin in 2025 is realistic and besides we now have a trampute because of which Bitcoin could become a strategic reserve for the US.”
We also got a rather bold statement and radical strategy from Michael Saylor, who has known Trump for 20 years and talks to him regularly believes that the US is likely to start selling its gold soon:
“Gold is just a shiny outdated rock – sell it. If you want to strengthen US economic leadership in the world there are two very simple strategies. Sell gold and buy Bitcoin so you simultaneously devalue the asset held by your enemies and get 20 to 25% of the Bitcoin network. Whoever owns gold will suffer greatly from this just sell all the gold and once and for all remove its status as a monetary asset. The US should develop such a structure e.g. Tether could move its operations to New York, that’s what we need. Then we could allow JP Morgan or Goldman Sachs to issue their own stablecoins.”
By the way, a couple of days ago Goldman Sachs complained that it can not invest in Ether or Bitcoin because of regulatory approval. When it is, the largest banks in the U.S. will be able to directly invest in Ether and Bitcoin, and apparently, they will be able to issue their own crypto, which will be backed by U.S. Treasury bonds, and therefore will be their main buyers, which could in the future solve the debt problem.
Thus Saylor proposes a strategy in which the U.S., through aggressive gold sales and massive Bitcoin purchases, will be able to dominate the global economy while weakening the economies of other countries.
A little critical thinking is in order here, as with any radical strategy. It is a strategy of potential extremes in economic policy that could lead to negative consequences in the global economy as well as turn U.S. allies away from the U.S. In addition, it could put the U.S. in a vulnerable position of relying so heavily on just one asset, and what would happen if America’s enemies tried to crash the Bitcoin price?
It is worth adding that major issuers have long been saying that 2025 will be much more successful in terms of money inflows not only into spot Bitcoin and ETFs but also Ethereum ETFs and others like Solana, XRP, Litecoin, and LINK.
Bitwise predicts that in 2025 the inflows into spot crypto ETFs will be greater than this year and it should be added that the launch of spot Bitcoin this year has already been the most successful in the history of all U.S. ETFs what will happen in 2025.
It’s actually not that much if you do a simple calculation independent investment advisors and those who run their own firms together manage about $8T in assets and in every survey conducted by Bitwise, it appears that three-quarters of advisors plan to allocate a portion of their assets to invest in Bitcoin ETFs with an average investment of about 2.5% of all assets.
If you calculate from $8T that gives $150B and that’s just independent advisors and that doesn’t include large brokers, brokerage firms, regional dealers, and institutional investors.
Conclusion
This is only one scenario of what is happening, and probabilities have different variants of development. Perhaps this is just the beginning of a big cycle, which will not end this time only on cryptocurrency and will not move to the big economy and politics. Or things will get stuck at an intermediate stage, only paving the way for the next cycle.
Be aware and stay tuned.
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