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The Financial Accounting Standards Board (FASB) has implemented new fair value accounting rules for Bitcoin and other eligible crypto assets, allowing companies to measure these assets at current market prices in their financial statements. This change is expected to enhance transparency and accuracy in corporate reporting, facilitating better assessment of risks and performance for investors and stakeholders. However, non-fungible tokens (NFTs) remain exempt from these rules due to their unique characteristics and valuation challenges.
Michael Saylor hinted that MicroStrategy has made its first Bitcoin purchase with an average price exceeding $100,000, following a series of acquisitions over recent weeks. The firm, which holds 423,650 Bitcoin valued at over $43.6 billion, has seen its stock soar 496.4% year-to-date, earning a spot in the Nasdaq-100. Saylor remains committed to buying Bitcoin, expressing confidence in future purchases even at $1 million.
Stock futures showed little movement as Wall Street anticipates a potential Federal Reserve rate cut this week. The Dow is on a seven-day losing streak, having dropped 1.8% last week, while the S&P 500 and Nasdaq Composite experienced slight declines and gains, respectively. Key economic data will be released on Monday, and the Fed's meeting is set for Tuesday and Wednesday, where a rate reduction is expected.
BlackRock's head of ETFs, Jay Jacobs, emphasizes that demand for Bitcoin and Ethereum ETFs is just beginning, with only a small fraction of clients currently invested. The iShares Bitcoin Trust ETF (IBIT) has $54.38 billion in net assets, while the iShares Ethereum Trust ETF (ETHA) holds about $3.84 billion. As interest grows, Bitcoin is increasingly linked to various options strategies, indicating a trend towards more complex investment products.
MicroStrategy has significantly increased its Bitcoin holdings, purchasing 5,117 BTC for $510 million, bringing its total to 423,650 BTC. Meanwhile, Avalanche secured $250 million for its upgrade initiative, and Ripple received approval for its RLUSD stablecoin targeting the global liquidity market. Solana shows bullish potential with a strong market presence and a significant increase in total value locked, while expectations rise for potential regulatory changes under the incoming Trump administration.
Artificial intelligence stocks have driven significant market gains, with the S&P 500 rising 49% and the Nasdaq Composite soaring 75% since the launch of ChatGPT in late 2022. However, caution is advised as not all megatrends or associated companies are equally promising, and historical trends suggest potential for continued growth in 2025. Investors are encouraged to focus on established players or index funds rather than speculative stocks.
Dow Jones, S&P 500, and Nasdaq futures will open Sunday evening, with the final Federal Reserve meeting of 2024 scheduled for Dec. 17-18, where a quarter-point rate cut is expected. The stock market had a mixed week, with the Nasdaq slightly up, driven by gains in Alphabet, Tesla, and Broadcom, while Nvidia lagged amid rising Treasury yields. Palantir, MicroStrategy, and Axon Enterprise will join the Nasdaq 100 index, replacing Moderna, Super Micro Computer, and Illumina.
Changpeng Zhao, CEO of Binance, highlighted the exchange's $500 million investment in Elon Musk's Twitter acquisition, now known as X, emphasizing its strategic importance in the cryptocurrency space. Despite initial skepticism about Musk's plans for the platform, X has emerged as a vital communication tool for the crypto community, fostering free discussion and information sharing. Meanwhile, analysts suggest that MicroStrategy's inclusion in the S&P 500 remains unlikely due to inconsistent profitability, despite potential accounting changes that could enhance its earnings visibility.
Bitcoin's price surged 2.65% to approximately $102,645, driven by MicroStrategy's inclusion in the Nasdaq 100 Index and a record inflow into US-based spot Bitcoin ETFs, which rose from $30.43 billion to $35.60 billion in two weeks. MicroStrategy's significant Bitcoin acquisitions and growing institutional interest, alongside proposals for a US strategic Bitcoin reserve, are fueling market optimism. However, Bitcoin is also testing a rising wedge pattern, indicating potential volatility ahead.
MicroStrategy, Palantir Technologies, and Axon Enterprise will join the Nasdaq-100 on December 23, replacing Illumina, Super Micro Computer, and Moderna. MicroStrategy's inclusion is expected to attract around $2.1 billion from ETFs tracking the index, potentially driving its stock price up to $600, as it serves as a proxy for Bitcoin investments. Following the announcement, Bitcoin saw a slight increase, trading above $102,000 million.
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