Summary Monday marked the biggest day ever for Bitcoin in terms of the absolute dollar gain. The cryptocurrency industry spent around $135 million in the 2024 election cycle to back more than 50 candidates. If the United States establishes a Bitcoin strategic reserve, it will kick off a global FOMO unlike anything we have ever seen before. The U.S. already has a good start with 208,109 Bitcoin worth around $16 billion. It has been quite an amazing week for cryptocurrency investors. Monday marks the biggest day ever for Bitcoin ( BTC-USD ) in terms of the absolute dollar gain, at over $9,000. The Bitcoin price has surged 30% higher in just 7 days to $88,000! The #2 cryptocurrency by market cap, Ethereum ( ETH-USD ), is up 38% in the past week. Many of the smaller altcoins that we hold in the Nicoya Research Crypto Corner portfolio are up over 50% in the past week, with our top pick up over 75%! This puts most of our cryptocurrency positions at gains of 200% or more year-to-date in 2024. The election of Donald Trump has helped, as both he and his inner circle have been incredibly supportive of the cryptocurrency industry during the election cycle. It is estimated that around 75% of the pro-crypto candidates won last week. The cryptocurrency industry spent around $135 million in the 2024 election cycle to back more than 50 candidates. These candidates included both Democrats and Republicans. 53 out of 56 candidates backed by crypto’s PACs have been declared winners. Crypto made its biggest bet in Ohio, spending $40 million on Bernie Moreno. Moreno’s campaign was against Senate Banking Chair Sherrod Brown, who has been a vocal crypto critic. President Trump has promised to fire Gary Gensler, who has been a thorn in the side of the crypto industry for years. JD Vance reported that he holds at least $250k of crypto personally. But perhaps the most bullish political development for the cryptocurrency sector has been calls from Trump and other prominent politicians to establish a strategic Bitcoin reserve. In July, Trump pledged to form a Bitcoin Reserve, using 210,000 Bitcoin seized by the Department of Justice, as the core of a new “Strategic National Bitcoin Stockpile.” Senator Cynthia Lummis tweeted: We Are Going To Build A Strategic Bitcoin Reserve. Her Bitcoin Strategic Reserve bill proposes the U.S. buys 1 million bitcoin over 5 years. That’s 547 bitcoin every day, or more than all new bitcoin currently mined daily (450). Lummis went on to say: A Strategic Bitcoin Reserve will allow the US to address a meaningful portion of our debt + strengthen our hand. See ‘Currency Wars’ for a good primer on the ‘stupid games, stupid prizes’ cycle we are in. Let’s break the cycle and refocus on a prosperous future for Americans. Just today on CNBC, Barbara Goldstein said that her investment group in very high on Bitcoin and believes it could become the next United States strategic reserve asset. Florida’s Chief Financial Officer Jimmy Patronis is advocating for a strategic Bitcoin reserve, saying that BTC is “digital gold.” Tulsi Gabbard also commented that: “There is value in the U.S. having its own strategic Bitcoin reserve.” We now have approximately three months until the U.S. Government puts into law active accumulation of Bitcoin as a strategic reserve asset. Other sovereign nations are certainly discreetly front running the United States. The clock has already started ticking and in 2025, I expect that multiple states will have Strategic Bitcoin Reserve legislation introduced. German parliament member Joana Cotar commented this week: “If the U.S. starts a strategic Bitcoin reserve, expect a serious case of FOMO (fear of missing out) across Europe.” Dennis Porter, CEO & Co-Founder of Satoshi Act Fund, and President & Founder of Satoshi Educate, claims that the momentum is already building, after having calls with nation states that are already moving rapidly to acquire Bitcoin. It’s all happening much faster than expected and the momentum is incredible. History is currently being made. If the United States establishes a Bitcoin strategic reserve, it will kick off a global FOMO unlike anything we have ever seen before. And this will be global, with China Central TV reporting this week that “Trump has promised to make the US the world’s Bitcoin and crypto capital and establish a strategic Bitcoin reserve.” It is logical to conclude that China will continue in the race to accumulate Bitcoin and may accelerate purchases to catch up to the United States soon. The U.S. already has a good start with 208,109 Bitcoin worth around $16 billion. Only China is close with 190,000 BTC ($14.5B worth). The UK is a distant third place at around 61,000 Bitcoin or $4.7 billion worth. USA: $15.9B (Largest Holder)China: $14.5BUK: $4.67BUkraine: $3.53BBhutan: $957MEl Salvador: $452MVenezuela: $18.32MFinland: $6.87M Germany, however, made headlines for selling its seized Bitcoin too early, missing out on over $1.4B in potential profits in just a few months. Germany sold 50,000 BTC at $54,000 each, now worth $88,000 each. Bitcoin ETFs have undoubtedly been a hit since launching earlier this year. That momentum has continued, with Blackrock’s Bitcoin ETF officially surpassing its Gold ETF in terms of the dollar value of the assets each ETF holds. In other words, the Blackrock Bitcoin ETF holds more Bitcoin (in dollar terms) than the Blackrock Gold ETF. The inflows to this Bitcoin ETF have reached $33.2 billion in just 10 months! While Bitcoin is currently worth $1.7 trillion, the price still needs to more than double just to reach the market cap of Nvidia and needs to go up around 10x to reach the market cap of gold. At $90,000, Bitcoin flips SilverAt $91,150 Bitcoin flips Saudi AramcoAt $107,280 Bitcoin flips GoogleAt $109,650 Bitcoin flips AmazonAt $156,700 Bitcoin flips MicrosoftAt $170,900 Bitcoin flips AppleAt $179,680 Bitcoin flips NVIDIAAt $913,000 Bitcoin flips Gold Speaking of publicly traded companies, several Bitcoin miners have been accumulating Bitcoin by keeping a portion of what they mine rather than selling it. Michael Saylor and MicroStrategy ( MSTR ) are best known for building a Bitcoin Treasury. As of Nov. 10, the company held a total of 279,420 bitcoins, which were acquired at an aggregate price of ~$11.,9B and an average purchase price of $42,692 per bitcoin. This strategy has worked well for Microstrategy and their investors, as the share price is up 537% in the past year alone! Other public companies are starting to follow the Microstrategy playbook, with Semler Scientific, Inc. ( SMLR ) purchasing $57 million for its balance sheet this year. The company is benefiting, with the SMLR share price up 101% in the past month alone! Other top public companies holding Bitcoin include Galaxy Digital Holdings ( BRPHF ), MARA Holdings ( MARA ), Tesla ( TSLA ), Coinbase ( COIN ), and Block ( SQ ). This chart below is current as of November, but does not include Saylor’s latest Bitcoin purchases for MSTR. One signal that the current rally is being driven by smart money, sovereign nations, corporations and not retail, is the following chart of Google search trends for “bitcoin.” Mainstream investors are not searching for Bitcoin and looking at how to invest. New investors are not driving this price advance, which tells me we are likely in the early innings. Retail traders typically join late and push prices to blow-off tops. They will have their own FOMO and we will see retail increasingly joining the party in the weeks and months ahead, pushing the Bitcoin price even higher. The Bitcoin ETFs also only bought $340 million today, much lower than recent days. For this number not to be higher on the largest dollar gain in Bitcoin’s history, suggests someone else very large is moving the market and not retail. If you have been following our research, you will know that we first suggested Bitcoin to our subscribers around $100, added Bitcoin to the Nicoya Research portfolio under $1,000 and have recommended buying monthly ever since. We were accumulating during the dip of 2022/2023 and continue to dollar cost average with regular purchases. This is a long-term play, and we continue to believe it is the best investment of our generation. We also hold a principled view that Bitcoin is not only good for our financial portfolios, but good for humanity at large. The return to a form of scarce, free market money that is not controlled by a small group of bankers or politicians provides a level playing field and opportunity for anyone to prosper. Many investors have stood on the sideline and watched. They are too scared to buy on the dips and then fear they missed the boat on the rallies. They are now wanting to get in, but are worried it may be too late. My outlook remains incredibly bullish. Governments that can create their own currencies have an unlimited amount available to start building their strategic Bitcoin reserves. With Trump announcing his support, winning the election and then a Senator introducing a bill to acquire 1 million Bitcoin for the United States, you can be sure that multiple nations are trying to front run the U.S. and acquire Bitcoin at lower prices. This could turn into an all-out race and push the Bitcoin price exponentially higher. We are literally going to see infinite balance sheets pouring into absolute and immutable scarcity. Literally ∞/21M. And this is happening 6 months after the latest halving, which is typically when we see the greatest price gains of each cycle as the lower supply output works through markets. So, while you can expect plenty of volatility, the trend is going to be firmly to the upside and this bull cycle in Bitcoin and the wider cryptocurrency sector still has plenty of upside ahead in my view. I think investors will do well to just buy and hold Bitcoin. I advocate for self-custody using a hardware wallet, but everyone will have to decide which method of ownership/custody is best for them. Those that can make regular purchases and stack over time, increasing buys on dips, are likely to do even better. At Nicoya Research, we also hold several smaller-cap cryptocurrencies that have outperformed Bitcoin, as well as a few crypto stocks that are generating leveraged returns for our portfolio. I also share strategies to further increase returns via staking and utilizing decentralized finance platforms. Original post Editor's Note: The summary bullets for this article were chosen by Seeking Alpha editors.
