Bitcoin rally fizzles as crypto token’s record-breaking year winds down
A Bitcoin rally is fizzling in the final days of a record-breaking year for the digital asset, as investors assess the remaining impetus from U.S. President-elect Donald Trump’s embrace of the cryptocurrency sector.
The largest token changed hands at US$96,445 as of 6:33 a.m. Friday in New York, partly paring a retreat of almost three per cent from a day earlier. Smaller rivals including Ether and Dogecoin, a favorite of the meme crowd, oscillated in tight ranges.
Trump is pushing ahead with a promise to create a crypto-friendly environment in the U.S. and has backed the idea of establishing a national Bitcoin reserve. Traders are banking some of the profits sparked by the Republican’s crypto cheerleading and are waiting to see if the mooted reserve is feasible.
The crypto market is also braced for the expiry of a substantial quantity of Bitcoin and Ether options contracts on Friday — one of the biggest such events in the history of digital assets, according to prime broker FalconX.
The notional value of the Bitcoin contracts on the Deribit exchange — one of the largest for digital-asset derivatives — exceeds US$14 billion, while the equivalent figure for Ether is about US$3.8 billion.
Sean McNulty, director of trading at liquidity provider Arbelos Markets, flagged the risk of a “choppy market” amid the expiry of the derivatives positions.
Bitcoin is wavering even after MicroStrategy Inc. this week signaled the possibility of expanding its program of purchases of the token. The company has transformed itself from a software maker into a Bitcoin accumulator and now owns more than US$40 billion of the digital asset.
The original cryptocurrency is flirting with a drop for December, which would be its first monthly decline
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