Bitcoin Enters' Santa Claus Mode' Amid Growing Optimism for US Reserve Status

It comes as the Federal Reserve is anticipated to decrease interest rates in December and as talk grows that Trump may make Bitcoin a US reserve asset from "day one" and beyond.

Bitcoin's price rose 5% on December 15 to a new all-time high above $106,000, fueling speculation that it may become a US reserve asset.

According to TradingView statistics, Bitcoin (BTC) reached a high of $106,554 but has subsequently decreased to $96,855. The previous high was $104,000, reached on December 5.

CK Zheng, chief investment officer of ZK Square, told Cointelegraph that Bitcoin has likely entered "Santa Claus mode," as many investors fear losing out and seek to increase capital allocation to the asset class.

He forecasted a Bitcoin price of $125,000 in early 2025. Still, he warned that a 30% drop was conceivable because most of the bullish news from the incoming Trump administration had already been "priced in."

A 30% drop from $125,000 would cause Bitcoin to retrace to roughly $87,500.

It comes as Strike founder and CEO Jack Mallers said US President-Elect Donald Trump may issue an executive order classifying Bitcoin as a reserve asset on his first day in office on January 20.

"There's potential to use a day-one executive order to purchase Bitcoin," Mallers said:

"It wouldn't be the size and scale of 1 million coins, but it would be a significant position."

Meanwhile, Satoshi Action Fund CEO Dennis Porter stated that a third Bitcoin reserve measure is at the state level. However, he did not specify which state would follow in Texas and Pennsylvania's footsteps.

"We had both Pennsylvania and Texas. And now we have another state on board. And they emailed me the draft. So I know it's true," he remarked during an X Spaces event on December 15.

Porter said he expects at least ten states to introduce Bitcoin reserve bills.

"It's not going to stop. We're going to see more and more of these bills come. At least 10, in my opinion."

Financial commentators predict a 0.25% interest rate cut from the US Federal Reserve on December 18, which might push Bitcoin's price even higher in the coming months.

Another factor driving Bitcoin's price increase could be one of the Financial Accounting Standards Board's new guidelines, which allow institutions to record the worth of their crypto assets more accurately. The rule will apply to fiscal years starting after December 15.

According to the Crypto Fear and Greed Index, bitcoin's market mood is currently in the "Extreme Greed" category, scoring 83 out of 100.

It hasn't been higher since December 5, when Bitcoin crossed the $100,000 mark.