Price discovery at ₿1 = $100,000 level underscores the disruptive potential of blockchain technology and the market's acceptance and integration into the mainstream financial ecosystem. In a climate of deficit spending, inflation and geopolitical instability, bitcoin has solidified its position as a store of value. The fixed supply, decentralization and immutable unit of account offer a robust asset compared with fiat currencies. As central banks worldwide grapple with complex monetary policy challenges, bitcoin's appeal as a store of value continues to strengthen. This achievement is not merely a numerical or mathematical milestone, it represents the culmination of years of technological innovation, growing institutional acceptance, and a fundamental reevaluation of traditional monetary systems.
Charles Schwab incoming CEO: “I feel silly' for not buying crypto”
Don’t be this guy (sorry Rick). Digital assets are no longer a fringe investment, but an essential component of a well planned and diversified portfolio. Allocate 1% more of your portfolio than you do already, and consider Lightning Capital Funds
Key Catalysts Driving Bitcoin’s Valuation:
- U.S. Political Tailwinds: President-elect Donald Trump's pro-crypto stance and the nomination of Paul Atkins as SEC Chair and Former Paypal CEO, David Sacks as AI/Crypto Czar have injected newfound confidence into the market.
- Strategic Reserve Proposal: U.S. Sen. Cynthia Lummis has proposed to establish a strategic Bitcoin reserve without increasing the national deficit. The BITCOIN Act (Boosting Innovation, Technology, and Competitiveness through Optimized Investment Nationwide) aims to convert Federal Reserve gold certificates into Bitcoin, acquiring 1 million BTC for long-term holding. The US Government will go a long way to achieving this simply by not selling what they already possess through confiscation.
- Adoption: Major financial institutions have opened up to investors, BlackRock, JP Morgan, Goldman Sachs are driving adoption (23% of Americans are very likely to invest in digital assets in the next year, up from just 3% in 2021). There are thousands of employees working on tokenization of real world assets at major financial institutions.
- Global Economic Factors: Federal Reserve Chair Jerome Powell's comparison of Bitcoin to gold rather than as a competitor to the U.S. dollar has lent additional credibility to the asset. Powell told CNBC’s Andrew Ross Sorkin during the New York Times’ DealBook Summit. “It’s just like gold, only it’s virtual, it’s digital. People are not using it as a form of payment or as a store of value. It’s highly volatile. It’s not a competitor for the dollar, it’s really a competitor for gold.”
- Russian Regulatory Embrace: Russian President Vladimir Putin has signed legislation recognizing Bitcoin as property and establishing a taxation framework for cryptocurrencies. Our position is that many nations will soon follow publicly, and at least 5 nations are acquiring BTC already.
The $100K milestone ought to be viewed as a mile marker on the road to $200K. The confluence of institutional adoption, regulatory clarity, and macroeconomic factors are tailwinds. Growth is likely to accelerate as more countries grapple with economic uncertainties and seek reserves to traditional fiat systems.:
Institutional Adoption
- Over 87% of institutional investors indicated plans to invest in digital assets in 2024, up from 70%.
- BlackRock's iShares Bitcoin Trust (IBIT) has attracted over $21 billion in inflows by May 2024, surpassing the Grayscale Bitcoin Trust to become the world's largest Bitcoin exchange-traded investment fund.
- On October 30, 2024, BlackRock's Bitcoin ETF witnessed a record-breaking single-day inflow of $872 million.
User Adoption
- Approximately 562 million people worldwide own cryptocurrencies, which represents 6.8% of the global population. This marks a substantial increase from the previous year, with a 34% growth in cryptocurrency ownership compared to 2023.
- 40% of American adults own cryptocurrency, up from 15% in 2021.
Market Growth
- The global blockchain market is projected to reach $94 billion by the end of 2027, with a compound annual growth rate (CAGR) of 66.2%6.
- Worldwide spending on blockchain solutions is forecast to reach $19 billion by 2024.
- The blockchain market is expected to boost global GDP by $1.76 trillion by 2030, equivalent to 1.4% of global GDP.
Digital assets are no longer a fringe investment, but an essential component of a well planned and diversified portfolio. The road to $200,000=₿1 has been paved with institutional & user adoption, market growth and regulatory tailwinds from Capitol Hill, which are poised to catalyze the expansion of Bitcoin and the broader digital asset ecosystem. Lightning Capital is strategically positioned to capture alpha through tactical asset allocation in our Liquid Token Fund and by deploying capital into high-growth ventures driving mainstream adoption and the continued maturation of the digital asset ecosystem.
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