Data Analysis: Is Trump's Strategic Reserve Plan a Turning Point for Bitcoin's Price?
This pullback may be painful, but it does not seem to negate the major trend adopted by institutions.Original Author: Bravos Research
Original Compilation: Shenchao TechFlow
Trump officially announced the establishment of a Bitcoin strategic reserve. Could this be a turning point for Bitcoin?
The United States currently holds $748 billion in gold reserves, while the market value of Bitcoin is about $1.6 trillion.
If the government establishes a reserve similar to gold, it could drive Bitcoin prices up by 50%.
Recall that between September 2024 (before the election) and December 2024 (after Trump's victory), Bitcoin surged by 94%. At that time, rumors about Bitcoin reserves had already begun to circulate.
This suggests that the narrative of reserves may have already been priced in by the market. Meanwhile, Bitcoin is also facing other risks, such as the recent sharp decline in the U.S. stock market over the past month.
However, we still believe that the importance of the reserve announcement may exceed people's expectations, and this move could lay the groundwork for a significant rise in Bitcoin in 2025. After all, the U.S. is not the only country with strategic reserves.
The total global gold reserves are approximately $2 trillion, which exceeds the market value of Bitcoin. Furthermore, the U.S. government's holding of Bitcoin adds credibility to this asset class, and the prosperity of Bitcoin is built on trust and confidence.
Since December 2022, the Bitcoin bull market has primarily been driven by institutional adoption. The launch of the Bitcoin ETF in November 2023 sparked tremendous optimism, and since then, Bitcoin has risen by 85%.
In our view, this is very similar to the adoption of gold in the early 2000s: the first U.S. gold ETF was launched in November 2004, marking the beginning of a 400% bull market over the next few years.
However, the gold bull market did not happen overnight. The rise was gradual, and there were multiple pullbacks during this period.
If we compare the gold bull market of the 2000s with the current rise of Bitcoin, the patterns are very similar. This pullback may feel painful, but it does not seem to negate the larger trend of institutional adoption.
