Bitcoin breaks through 100,000 dollars, a top-level conspiracy

Author: Big Dog, Deep Tide TechFlow

On January 3, 2009, at 18:15:05, Satoshi Nakamoto wrote the headline of that day's front page of The Times in the Bitcoin genesis block: "The Times 03/Jan/2009 Chancellor on brink of second bailout for banks."

Who would have thought that this digital asset born in the shadow of the financial crisis would break through the historic threshold of $100,000 on December 5, 2024, becoming a financial giant with a market value of nearly $2 trillion.

From being worth nothing at first, to exchanging 10,000 bitcoins for two pizzas in 2010; to 2011, when early participants cheered as Bitcoin was about to break $10; to 2017, when it first broke $10,000, causing a global sensation, and then to 2024 when the Bitcoin spot ETF was approved and listed on the US stock market… this "internet bubble" that was once scoffed at has now become the "digital gold" that Wall Street financial giants like BlackRock and Fidelity are scrambling to pursue.

Every transformation of Bitcoin is astonishing, rewriting people's understanding of currency, value, and wealth.

So the question arises, do you hold Bitcoin? Are you holding onto Bitcoin?

Recently, many traders and professionals in the crypto industry have received messages like "Congratulations, you must have made a fortune recently." At this time, they can only awkwardly reply, "Not bad, not bad," while others think you are being modest, but only you know you are silently crying.

There are two heartbreaking and unexpected facts: This bull market belongs solely to Bitcoin, and most retail investors no longer hold Bitcoin.

Why is Bitcoin the standout in this cycle?

Top-Level Conspiracy

This is a top-level conspiracy that has long been scripted.

Let’s go back to 4 AM on January 11, 2024, when the U.S. Securities and Exchange Commission (SEC) approved 11 spot BTC ETFs, including BlackRock's IBIT.

Perhaps as Wang Chuan said: "The significance of January 10, 2024, in the history of world currency may one day be compared to August 13, 1971 (when Nixon announced the decoupling from gold) and January 18, 1871 (when Germany unified and led European countries and the U.S. to join the gold standard system in the following years)."

The approval of the spot ETF opened the floodgates for institutional funds to enter, from then on, Bitcoin is Bitcoin, and other cryptocurrencies are others.

As of November 21, in just 10 months, Bitcoin ETFs attracted a cumulative inflow of $100 billion, which is equivalent to 82% of the size of U.S. gold ETFs, just a step away.

Bitcoin is no longer a speculative market dominated by retail investors but is gradually being led by traditional financial institutions, whether Wall Street financial firms or publicly listed companies in various countries, even some sovereign governments are engaged in a scramble for funds.

The most representative player in this battle is the U.S. publicly listed company MicroStrategy (MSTR).

MSTR's original main business was enterprise analytics software. In August 2020, under the leadership of Chairman Michael Saylor, MSTR announced it would spend $250 million to purchase 21,454 BTC, becoming the first publicly listed company to implement a Bitcoin capital strategy.

MSTR's strategy for purchasing Bitcoin is to issue stocks and bonds, borrowing at about 1% interest to buy Bitcoin. According to disclosures, MSTR has announced about 40 Bitcoin purchases over the past four years.

As of now (December 5), MSTR holds over 402,100 bitcoins, accounting for about 1.5% of Bitcoin's global total supply, making it the largest publicly listed company holder of Bitcoin. MSTR has spent a cumulative $23.483 billion to purchase Bitcoin, with an average cost of about $58,402, and as of now, it has an unrealized profit of over $16.7 billion.

On November 20, MSTR's stock price briefly surpassed $500, with a market capitalization exceeding $100 billion. On that day, its trading volume even surpassed that of the leading U.S. stock Nvidia, with a stock price that has increased more than 40 times since it began accumulating Bitcoin at around $12 in August 2020, becoming a star stock in the U.S. market.

Buy Bitcoin first, then issue stocks at a premium based on Bitcoin, then issue bonds using Bitcoin as collateral, as Bitcoin rises, the company's stock price rises, then issue bonds and stocks to continue buying… Following MicroStrategy's example, many major publicly listed companies around the world have begun to imitate this Bitcoin accumulation model, including Japanese listed company Metaplanet, U.S. listed medical company Semler Scientific, German listed company Samara Asset Group, Hong Kong listed company Meitu, and Boyaa Interactive.

Statistics show that more than 60 publicly listed companies are now accumulating Bitcoin, and thousands of private companies are also following suit.

MSTR CEO Michael Saylor has become one of the most influential evangelists for Bitcoin, promoting it everywhere.

Michael Saylor will have three minutes to present Bitcoin purchasing strategies to the Microsoft board. He previously stated that if Microsoft converted a portion of its cash to Bitcoin each quarter, it could create trillions of dollars in value for shareholders over the next decade, increasing its market capitalization by hundreds of billions.

The Bitcoin ETF opened the door, MSTR personally bought and promoted, but the real reason for the recent rapid rise of Bitcoin can be attributed to one person—Trump.

At the Bitcoin 2024 conference in July, Trump publicly promised to make the U.S. the global "cryptocurrency capital" while establishing a national Bitcoin reserve.

At the end of September, Trump and his three sons, Donald Jr., Eric, and Barron, announced their latest entrepreneurial project, World Liberty Financial. This new enterprise is described as a decentralized finance (DeFi) currency market platform, launching a proprietary cryptocurrency called $WLFI.

Trump himself has also taken action, becoming "the first president to buy a hamburger with Bitcoin."

Trump's assistant, Vice President Vance, is also "one of the crypto circle," according to disclosed personal financial reports, as of 2022, he owned Bitcoin worth between $100,000 and $250,000 on the crypto exchange Coinbase.

In addition, one of the biggest contributors to Trump's victory, the world's richest man Elon Musk, is also a well-known cryptocurrency enthusiast, promoting Tesla's purchase of Bitcoin to include it in its financial statements. He has been particularly active in supporting Dogecoin, even establishing a government efficiency department named after Dogecoin, DOGE (Department of Government Efficiency).

During Biden's term, the U.S. Securities and Exchange Commission (SEC), led by Gary Gensler, launched an unprecedented crackdown on the cryptocurrency industry. From suing Ripple to launching heavyweight lawsuits against Binance and its CEO Changpeng Zhao; from classifying a large number of cryptocurrencies as unregistered securities, frequently issuing hefty fines to various crypto projects, to sending warning letters to Coinbase… the U.S. cryptocurrency market has been shrouded in regulatory gloom.

Trump's ascendance marks a complete shift in U.S. cryptocurrency policy, clearing the gloom and removing institutional barriers for the development of cryptocurrency in the U.S.

In summary, the elements of this top-level conspiracy have been pieced together through various coincidences:

As the U.S. begins a rate-cutting cycle, the Bitcoin ETF is approved, and Wall Street giants like BlackRock and Vanguard join the Bitcoin interest group, leading a massive influx of funds into Bitcoin.

MSTR CEO Michael Saylor transforms into the Bitcoin "milk king," continuously borrowing to increase Bitcoin holdings, causing both Bitcoin and stock prices to spiral upwards, prompting many publicly listed companies to follow suit.

Trump's victory, the new U.S. president personally endorsing Bitcoin, removing institutional barriers, and planning to make BTC a strategic reserve asset for the U.S.

All plans and actions are prominently displayed, everyone has the opportunity to participate, and all participants can profit… this is the top-level conspiracy, through ETF products dominated by Wall Street financial giants, the U.S. is transforming Bitcoin, this decentralized rebel, into a controlled financial instrument.

Perfect Narrative

So the question arises, why Bitcoin? Why only Bitcoin?

The narrative charm of Bitcoin lies in its simplicity; it does not require technical delivery and cannot be falsified, like a perfect closed loop, every crisis reinforces rather than weakens its value proposition.

In 2009, it was born from the ruins of the financial crisis, with the mission to combat inflation and the banking system; during the pandemic in 2020, unlimited quantitative easing by various countries made Bitcoin's scarcity narrative shine even brighter; in 2022, during the Russia-Ukraine war, Bitcoin became a weapon in the invisible financial war, illustrating what a super-sovereign currency is and reaffirming the importance of decentralized assets; in 2024, with the Federal Reserve cutting interest rates and geopolitical turmoil intensifying, Bitcoin perfectly plays the role of a safe-haven asset.

From the early "digital gold" to the later "super-sovereign asset," and then to "the cornerstone of Web3," every narrative of Bitcoin has been reinforced in reality.

In the crypto world, we have seen too many grand visions and complex technical solutions, but what has stood the test of time is precisely the simplest Bitcoin. It does not require marketing, does not need a roadmap, nor promises of technological upgrades. Its value proposition is as simple and undeniable as the law of gravity: a decentralized, scarce, and immutable value network.

This is why it can only be Bitcoin. Because in a world full of uncertainties, the most precious thing is certainty. Bitcoin provides just that certainty: a definite supply, definite issuance rules, and a definite operating mechanism.

Challenging Gold

Now that Bitcoin has crossed the $100,000 threshold, its next step will be to challenge gold's status.

As of December 5, in the ranking of the top ten global assets, gold ranks first with a market value of $18 trillion, while Bitcoin's market value is $1.98 trillion, surpassing silver and Saudi Aramco, ranking seventh.

Central banks are one of the core buyers of gold, and the continuous international political black swans and turbulent regional situations have driven the demand for gold. In 2022-2023, global central banks net bought more than 1,100 tons of gold for two consecutive years, making them the largest buyers in the international gold market in the past three years and the main drivers of this round of gold price increases.

Specifically, European and American countries are net sellers of gold, while emerging countries are net buyers. Emerging central banks like China are increasing their gold holdings and reducing U.S. Treasury bonds to lower their dependence on the dollar system.

The trend of de-dollarization is reshaping the landscape of global reserve assets.

Compared to gold, Bitcoin has disadvantages in cultural consensus and market value, but it also has its unique advantages.

Compared to gold, Bitcoin's supply is more transparent and predictable, never exceeding 21 million coins. After the halving in 2024, the daily new Bitcoin will drop to 450 coins, with an annual inflation rate of only 0.8%. In contrast, gold's annual production remains around 3,500 tons, equivalent to an inflation rate of 2-3%.

Bitcoin's digital characteristics give it significant advantages in cross-border transfer and storage management; it does not require specialized vaults or complex transportation, and a cold wallet can store billions of dollars in assets, which is particularly important during times of geopolitical tension.

Bitcoin does not belong to any country, is not controlled by any single government, is easy to transfer, and has transparent supply, making it an ideal supplementary reserve asset.

In the week of Trump's victory, BlackRock's Bitcoin ETF-iShares (IBIT) reached a total asset size of $34.3 billion, surpassing its gold trust fund (IAU), noting that gold ETFs have been around for 20 years.

If Trump truly fulfills his promise to make Bitcoin a strategic reserve for the U.S., the significance of this signal will far exceed the actual quantity purchased. The familiar landscape of our financial system will be rewritten.

Just like when the dollar was pegged to gold, the U.S. attitude directly determined the fate of the entire Bretton Woods system. Now, the U.S. attitude towards Bitcoin may also trigger a paradigm shift in reserve assets.

We have already seen some preliminary signs: El Salvador was the first to adopt Bitcoin as legal tender, though the scale is small, it set a precedent; some sovereign wealth funds are quietly laying out Bitcoin investments, such as Singapore's sovereign fund Temasek investing in several cryptocurrency-related companies; Bhutan has been actively mining Bitcoin since 2021…

If more countries begin to include Bitcoin in their reserve asset allocation, even if only allocating 1-5%, the demand for Bitcoin will experience a qualitative leap. It is worth noting that global foreign exchange reserves exceed $12 trillion.

Institutional investors are continuously absorbing market liquidity through ETFs, the number of long-term holders is steadily increasing, the trading volume on exchanges is continuously declining, and publicly listed companies are accumulating Bitcoin. If sovereign reserve demand is added, the scarcity premium of Bitcoin will be pushed to a whole new height.

If that happens, with only 21 million bitcoins, it will inevitably not be enough to buy.