Fed Chairman Says No Intention to Hold Bitcoin as Reserve Asset, Despite Trump's Push

Week of December 24-30, 2024

Chairman of the U.S. Federal Reserve (Fed), Jerome Powell, admitted that the Fed has no authority to hold Bitcoin (BTC) and they have no intention to change the law either. He also emphasized that this decision is for Congress to consider.

K33 Research revealed that Assets Under Management (AUM) of Spot Bitcoin ETFs and Bitcoin Futures ETFs have surpassed that of gold ETFs for the first time, with the combined AUM exceeding $129 billion. Considering it's only the first year of trading, this figure could potentially grow even further.

CoinShares have reported that inflows from Spot Ethereum ETFs could surpass those of Spot Bitcoin ETFs by 2025. After experiencing consecutive net inflows for 7 weeks, attention will now be on whether the SEC will approve staking rewards, which could attract significant investor interest.

Bloomberg analysts predict that more cryptocurrency-based ETFs will become available in 2025. Funds tied to Solana (SOL) and Ripple (XRP) are top targets awaiting approval from the U.S. SEC under a new administration.

MicroStrategy’s Bitcoin purchases have surged beyond the levels seen during the 2021 bull market. The company made its largest purchase to date, acquiring 55,500 BTC on November 24, 2024, at approximately $97,000 per BTC. This compares to its largest previous purchase of 29,646 BTC on December 21, 2020, at a price of $21,000 per BTC.

It is forecasted that AI Agents will become a major force in the Web 3.0 space by 2025. VanEck predicts that over 1 million AI Agents will operate within blockchain networks by the end of 2025, especially on the Ethereum chain.

Technical Analysis

technical-en-01@1-Dec-25-2024-08-27-59-2390-AM

Bitcoin (BTC)

Bitcoin (BTC) has experienced a strong decline, and the RSI index is showing signs of weakening, indicating a potential drop to test the support level at $86,000. This could be considered a buying opportunity, with the first support level at $90,000. The pullback is expected to be limited, therefore investors can gradually accumulate at the support levels. The target is to revisit the previous high at $108,000.

Support: 3,000,000 THB / 86,000 USD
Resistance: 3,700,000 THB / 108,000 USD

technical-en-02@1-Dec-25-2024-08-27-59-3292-AM

Ethereum (ETH)

Ethereum (ETH) has experienced a significant decline too, but the support level at $3,000 could be considered an attractive long-term buying point, and investors can start accumulating at this level. The first resistance target is at $3,500, and if it surpasses this mark, the price may revisit its previous high at $4,100. However, if it fails to hold the support level, then it's advisable to put a pause on further investments.

Support: 104,000 THB / 3,000 USD
Resistance: 124,000 THB / 3,500 USD

technical-en-03@1-Dec-25-2024-08-27-59-3188-AM

Ren (REN)

Ren (REN) posted returns of -0.04% last week. Although the decline was not as steep as the overall market, caution is needed as the price may still drop below its previous low of $0.0260. If this happens, the trend could turn bearish. However, if the price rebounds, it's advisable to take profits in the short term at the $0.040 level.

Support: 0.80 THB / 0.0260 USD
Resistance: 1.40 THB / 0.040 USD

technical-en-04@1-Dec-25-2024-08-27-59-2323-AM

Hedera (HBAR)

Hedera (HBAR) posted a return of -6.39% last week. Despite the decline, it has performed better than the overall market. The indicators show a possible consolidation for a potential upward move. However, caution is advised as the price fall further below the support level of $0.220. If it can hold this base, there is a chance it will rise and test the resistance level at $0.310.

Support: 7 THB / 0.220 USD
Resistance: 13 THB / 0.31 USD

Investment Trends

Investors have been selling off Bitcoin (BTC), leading to a significant outflow of funds from Spot Bitcoin ETFs, the highest in several months. This phenomenon was driven by concerns that the U.S. Federal Open Market Committee (FOMC) may only cut interest rates twice next year, a reduction from previous expectations. However, the Personal Consumption Expenditures (PCE) index, released last Friday, showed a lower-than-expected drop, which has increased the likelihood that the FOMC may cut rates in the first meeting of 2025, thus easing pressure on the market.

Most altcoins have experienced declines in tandem with the overall market, with only a few within the DeFi category performing well. In general, there has been a significant outflow of funds from altcoins, so it’s not yet the right time for short-term speculation. However, certain coins with solid fundamentals can be viewed as potential long-term investments.

As the Christmas season arrives, there is no major economic revelation expected to affect the market. However, look out for a potential ‘Santa Claus Rally’, which often happens with the U.S. stock market during this period—especially in presidential election years—which could also positively impact the cryptocurrency market.

The recommended investment strategy is to gradually invest in Bitcoin (BTC) and Ethereum (ETH) at their respective support levels, as well as altcoins with strong fundamentals, and limited downside risk. The market’s current pullback can be seen as a temporary consolidation before potentially recovering and continuing upwards for the new year.

References

Disclaimers

Cryptocurrencies and digital tokens are highly risky; investors may lose all investment money. Investors should study information carefully and make investments according to their own risk profile.
Past returns or performance of digital assets do not guarantee future returns or performance.

Remark: views, information, knowledge, and opinions are considered as content that come from individuals involved. They do not constitute an expression of Bitazza and its employees. Neither the email nor the content presented constitute investment advice.

Topics: Crypto Weekly

Share this