In the past 24 hours, Bitcoin’s (BTC) price has experienced a significant surge of 2.65%, reaching an all-time high of around $102,645 on December 14th. This upward trend can be attributed to several factors, including MicroStrategy’s inclusion in the Nasdaq 100 Index and the continued positive inflow of funds into US-based spot Bitcoin exchange-traded funds (ETFs).
MicroStrategy’s Inclusion in the Nasdaq 100 Index
One of the primary drivers behind Bitcoin’s price increase is the addition of MicroStrategy to the Nasdaq Global Indexes’ list of constituents for the Nasdaq 100 Index. This move follows MicroStrategy’s remarkable growth in 2024, with its share value soaring by a staggering 500% year-to-date. The company’s market capitalization has increased from $1.31 billion at the time of its first Bitcoin acquisition in 2020 to nearly $100 billion in December.
As seen in the chart above (MSTR-Tracker.com), MicroStrategy’s performance has surpassed that of about half the members of the Nasdaq 100 Index, meeting one of the key requirements for inclusion in the index. This development has significant implications for Bitcoin’s price movement, as a bullish Nasdaq 100 index could potentially lead to an upside impact on BTC.
Market analyst Alex Krüger provides insight into this phenomenon:
"MicroStrategy included in the Nasdaq. So people have to buy MSTR because its in the index which means Saylor can sell more shares and converts to buy more bitcoin which pushes bitcoin up and then MSTR goes up which means you have to buy more shares to match the index, rinse and repeat,’ he explains.
This concept is further reinforced by Krüger’s statement:
"Bitcoin to infinity."
Record Bitcoin ETF Flows Drive BTC Prices Higher
The upward trend in Bitcoin’s price can also be attributed to the continuous inflow of funds into US-based spot Bitcoin ETFs. Between November 27th and December 13th, the cumulative flow into these funds jumped from $30.43 billion to a record high of $35.60 billion, as tracked by Farside Investors.
Recent significant acquisitions by prominent companies such as MicroStrategy and MARA Holdings also reflect growing institutional interest in Bitcoin as a strategic asset. On December 2nd and 8th, MicroStrategy acquired 21,550 BTC at an average price of $98,783 per Bitcoin, while on December 10th, MARA Holdings disclosed purchasing 11,744 BTC.
These developments are closely monitored by investors, who are also keeping a close eye on proposals such as Senator Cynthia Lummis’s plan to establish a US strategic Bitcoin reserve. This initiative aims to accumulate up to 1 million BTC over time, further driving market optimism.
Texas Lawmaker Proposes Legislation to Hold Bitcoin as Reserve Asset
In related news, a Texas lawmaker has introduced legislation to hold Bitcoin as a reserve asset for at least five years, emphasizing that "no taxpayer funds would be spent on buying Bitcoin." This move highlights the growing trend of Bitcoin adoption at both institutional and governmental levels.
Bitcoin May Slip Below $100,000 Again
While Bitcoin’s price surge is part of a broader consolidation trend occurring inside its prevailing rising wedge pattern, it may eventually test the wedge’s lower trendline at around $97,500. This level aligns with the 20-day exponential moving average (20-day EMA), and a breakdown below this threshold could lead to a potential downside target closer to BTC’s 50-day EMA at around $89,500.
However, if Bitcoin decisively breaks above the wedge’s upper trendline, it would likely invalidate the bearish reversal outlook. This scenario is reminiscent of Bitcoin’s behavior during the rising wedge pattern observed between August and November.
Disclaimer
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
Key Takeaways
- MicroStrategy’s inclusion in the Nasdaq 100 Index has contributed to Bitcoin’s price surge.
- Record inflows into US-based spot Bitcoin ETFs have driven BTC prices higher.
- Growing institutional interest in Bitcoin as a strategic asset is reflected by significant acquisitions by prominent companies.
- Proposals such as Senator Cynthia Lummis’s plan to establish a US strategic Bitcoin reserve are driving market optimism.
- Texas lawmakers propose legislation to hold Bitcoin as a reserve asset for at least five years.
Conclusion
Bitcoin’s price surge to $102,645 on December 14th is a testament to the growing trend of institutional and governmental adoption. As more companies and governments recognize the value of Bitcoin, its price is likely to continue rising. However, it is essential to conduct thorough research and consider individual risk tolerance before making any investment or trading decisions.