The total crypto market capitalization has seen a notable increase of 3.2% over the last 24 hours, reaching $3.71 trillion on December 16th. The overall trading volume has also jumped by 27% on the day to $162 billion, indicating intense demand-side pressure.
Bitcoin and Ethereum Prices Rise
- Bitcoin (BTC): The largest cryptocurrency by market capitalization has risen 3.5% over the last 24 hours, trading at $81,587, just below its all-time high of $106,488 set during early Asian trading hours on December 16th.
- Ethereum (ETH): The second-largest crypto has climbed 3.25% to trade around $3,976 at the time of publication.
Factors Driving Crypto Market Upward
Prospects of Bitcoin Becoming US Reserve Asset
US President-elect Donald Trump’s recent comment about his intentions to build a strategic Bitcoin reserve and do "something great" with crypto has contributed to the bullishness in the market today. Trump could issue an executive order on "day one" of his second term to designate Bitcoin a reserve asset status, according to Jack Mallers, founder and CEO of Strike.
"It wouldn’t be the size and scale of 1 million coins, but it would be a significant position," Mallers said.
There are also possibilities of a third Bitcoin reserve bill at the state level, which would follow Texas and Pennsylvania’s lead, said Satoshi Action Fund CEO Dennis Porter during an X Space on December 15th.
"It’s not going to stop. We’re going to see more and more of these bills come. At least 10, in my opinion," Porter added.
Reduced Interest Rates
The US Federal Reserve is expected to reduce the benchmark borrowing cost by 25 basis points to the 4.25% to 4.5% range, marking a total of 1% interest rate reduction since September 18th.
Market participants expect the latest core Personal Consumption Expenditures (PCE) price index reading this week, which is the Fed’s preferred measure of inflation. This reading will reveal whether the recent upticks in consumer price inflation are coincidences or signs of a genuine inflation rebound.
Institutional Demand for Spot ETFs Remains High
The crypto market’s ongoing gains align with the huge capital flows into the spot exchange-traded (ETF) funds. Farside Investors reported that approximately $2.16 billion flowed into US-based spot Bitcoin ETFs over the December 9 to December 13 week.
Similarly, spot Ethereum ETFs have also experienced two weeks of continuous inflows, and they have not witnessed a single day of net outflow since November 21st. They have now attracted $1.4 worth of capital over the last 14 days, taking the combined assets under management to a record high of $1.98 billion on December 13th.
Institutional Demand Demonstrated by MicroStrategy and Riot Platforms
Institutional demand is perhaps best demonstrated by continued buying by MicroStrategy, which now has a Bitcoin reserve worth over $44 billion. On December 4th, MicroStrategy CEO Michael Saylor hinted at further Bitcoin buying. In addition, Bitcoin mining giant Riot Platforms announced last Friday that it had acquired 5,117 Bitcoin at an average price of around $99,669 per BTC.
Ascending Parallel Channel Pattern
Data from Cointelegraph Markets Pro and TradingView shows that TOTAL—the total market capitalization of all cryptocurrencies—has rallied more than 34% since November 11th. This price action has recorded a series of higher highs and higher lows, leading to the appearance of an ascending parallel channel on the daily chart.
The price must hold above the immediate support provided by the lower boundary of the channel at $3.57 trillion to sustain the uptrend. If this happens, TOTAL may move first toward the middle boundary of the channel at $3.73 trillion and later to the upper boundary at $3.9 trillion. A breakout above the upper boundary would signal a bullish breakout from the chart pattern, with the next logical move being toward the $4.0 trillion mark, representing a 10.8% uptick from the current price.
Conclusion
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.
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