This year has been a landmark for Bitcoin, showcasing its growing integration into mainstream finance as evidenced by the approval of 11 exchange-traded funds (ETFs) in January. The launch of these ETFs was met with strong institutional demand, quickly amassing over $113.5 billion and driving Bitcoin’s price to an unprecedented $100,000 in December, propelled largely by professional investment.
Institutional backing significantly boosted over-the-counter (OTC) transactions, with Kraken witnessing a 220% increase in OTC markets, highlighting the growing enthusiasm. This wave of institutional adoption extended beyond ETFs, with public companies like MicroStrategy integrating Bitcoin into their financial strategies. By December 23, MicroStrategy aimed to expand its Bitcoin holdings significantly by purchasing an additional $42 billion worth of Bitcoin over three years, leveraging equity sales and fixed-income securities.
Meanwhile, Crypto.com embarked on expanding its influence with the launch of an institutional crypto custody service in the US, catering to high-net-worth individuals and institutional clients. This initiative forms part of their broader strategy to solidify their foothold in North America.
In regulatory developments, Russia imposed a six-year ban on cryptocurrency mining in ten regions beginning January 2025, introducing seasonal restrictions to manage energy consumption efficiently.
In the US, the IRS clarified its stance on the taxation of cryptocurrency staking rewards, affirming that these are taxable as income upon receipt, not at the point of sale. This decision followed a legal battle initiated by Joshua and Jessica Jarrett, challenging the IRS on this matter.
These developments outline a transformative period for Bitcoin and the broader cryptocurrency market, pointing to a future of deeper integration and complex regulatory landscapes.
