El Salvador will make Bitcoin acceptance by merchants voluntary, reduce its involvement in the Chivo wallet, and limit public sector Bitcoin-related activities as part of a $1.4 billion loan agreement with the International Monetary Fund (IMF).
The IMF announced on Dec. 18 that El Salvador would receive $1.4 billion over 40 months to lower its debt-to-GDP ratio.
“The potential risks of the Bitcoin project will be diminished significantly in line with Fund policies.
Legal reforms will make acceptance of Bitcoin by the private sector voluntary,” the IMF stated.
“For the public sector, engagement in Bitcoin-related economic activities and transactions in and purchases of Bitcoin will be confined.”
Additionally, taxes will continue to be paid in U.S. dollars — El Salvador’s official currency — and government involvement in the Chivo wallet will be gradually phased out.
El Salvador began purchasing Bitcoin in 2021 and currently holds 5,968.8 Bitcoin, valued at approximately $602 million, according to the National Bitcoin Office.
A spokesperson from the office told Cointelegraph that the country will continue its Bitcoin accumulation strategy.
“We will keep buying one Bitcoin a day (likely even more in the future), and we will not sell any of our current holdings,” the spokesperson stated.
“The plans for the Bitcoin Office remain the same as Bitcoin continues to be our main strategy.”
The agreement, still pending approval from the IMF Executive Board, concludes four years of negotiations following President Nayib Bukele’s adoption of Bitcoin as legal tender in September 2021, making El Salvador the first country to do so.
The IMF has consistently urged Bukele to abandon Bitcoin, citing its speculative nature as a potential risk to the country.
The deal will also unlock additional loans, including from the World Bank, for a total financing package exceeding $3.5 billion.
Reacting to the announcement, Bukele’s Bitcoin adviser Max Keiser dismissed the IMF’s stance, stating on X, “Nobody pays attention to these assh****,” and labeled the agreement “bureaucratic, meaningless nonsense.”
Keiser added, “Bitcoin use in El Salvador was always voluntary, and its usage has never been higher and continues to grow.”
However, a recent survey revealed that 92% of Salvadorans do not use Bitcoin for transactions, up from 88% in 2023.
Quantum BioPharma (QNTM), a biopharmaceutical company, has become the latest publicly traded firm to incorporate cryptocurrencies into its treasury strategy.
On Dec. 20, the company announced a $1 million investment in Bitcoin and other cryptocurrencies. Following the disclosure, QNTM’s shares on the Nasdaq dropped nearly 10%.
Quantum BioPharma, also listed on the Canadian Securities Exchange and Frankfurt Stock Exchange, specializes in biotech solutions for treating neurodegenerative diseases, metabolic syndromes, and alcohol misuse disorders.
“The company is now set up to receive financing in cryptocurrencies as well as executing other types of transactions in cryptocurrencies,” Quantum stated, though it did not reveal the specific tokens in its portfolio.
More non-crypto businesses are embracing digital assets to diversify their holdings and hedge against inflation.
In November, the U.S. Consumer Price Index (CPI) rose 2.7% year-over-year, with a 0.3% monthly increase, marking the sharpest rise in seven months.
Jiva Technologies, a wellness e-commerce firm, approved a plan to invest up to $1 million in Bitcoin last month, citing its inflation-resistant qualities. Similarly, video-sharing platform Rumble allocated $20 million of its cash reserves to Bitcoin in late November.
Hoth Therapeutics, another biopharmaceutical company, added $1 million in Bitcoin to its treasury on Nov. 20. MicroStrategy, which adopted this strategy in 2020, remains the largest corporate Bitcoin holder with 439,000 BTC as of December 2024.
Think Tank Advocates Bitcoin Adoption
The National Center for Public Policy Research, a Washington, D.C.-based think tank, has pushed major corporations like Amazon and Microsoft to adopt Bitcoin treasury strategies.
Microsoft shareholders voted against the proposal during a Dec. 10 meeting, calling it “unnecessary.” Amazon’s shareholders are set to review the proposal in April 2025.
The think tank plans additional Bitcoin-related proposals for 2025, aligning its efforts with a “pro-freedom” agenda.
Bitcoin (BTC) sought relief on Dec. 20 after Wall Street’s opening, as a sharp leverage flush continued to impact late bullish traders.
Data from Cointelegraph Markets Pro and TradingView showed BTC/USD climbing back above $96,000 on Bitstamp.
Despite a 1.5% daily decline, Bitcoin created challenging trading conditions, revisiting $92,000 lows from earlier in December, hitting long positions hard.
“The cascade of support loss has indeed occurred,” noted trader and analyst Rekt Capital on X, adding, “Bitcoin is now down -15% on this pullback.”
Rekt Capital had previously cautioned about potential corrections during bull markets, typically occurring six to eight weeks after breaking prior all-time highs. He remarked that the current dip “almost matches” a similar event from 2021.
“These corrections tend to last a few weeks,” he explained.
“Also, there tend to be up to 4 Price Discovery Corrections at most until a Bull Market ends. This is the first Price Discovery Correction in this cycle, which means it is an optimal re-accumulation opportunity with a high probability of price reversal to the upside.”
Liquidation data painted a stark picture for crypto traders. Monitoring resource CoinGlass reported $1.4 billion in liquidations across the crypto market over the past 24 hours.
Analyzing the source of Bitcoin’s short-term weakness, CryptoQuant contributor J. A. Maartun highlighted sell-side pressure originating from the United States.
Coinbase, the largest U.S. exchange, showed particularly strong selling activity. Maartun shared on X that the Coinbase premium — the price difference between Bitcoin on Coinbase and Binance — remained significantly negative.
As Bitcoin continues to test key support levels, traders are closely watching for signs of a reversal or further downside risk.
The question of whether Bitcoin’s 21 million supply cap is truly immutable has resurfaced after BlackRock released a three-minute explainer video on Dec. 17. The video included a disclaimer suggesting there’s no guarantee the cap won’t be altered.
Bitcoin’s fixed supply is a cornerstone of its value as a store of wealth, and any change could fundamentally impact its perception among investors.
In the video, BlackRock highlighted Bitcoin’s 21 million cap, noting it as a “hard-coded rule” that controls supply, purchasing power, and prevents excessive currency creation. However, the disclaimer stated: “There is no guarantee that Bitcoin’s 21 million supply cap will not be changed.”
MicroStrategy chairman Michael Saylor reposted the video, sparking criticism. Joel Valenzuela, Dashpay’s marketing director, commented, “When the supply cap increase happens, it will have ‘always been part of the plan.’ And today, in 2024, people have the audacity to say Bitcoin wasn’t hijacked.”
Ethereum developer Antiprosynthesis added, “BlackRock understands Bitcoin better than Bitcoiners.”
Is Bitcoin’s Supply Cap Changeable?
Bitcoin developer Super Testnet, known for BitVM, explained that altering Bitcoin’s supply cap would depend on how one defines “Bitcoin.”
In theory, the cap could change if a majority of the community—node operators, developers, miners, and investors—reached consensus on a hard fork. Such a change would involve a proposal to gauge consensus, followed by implementing changes in Bitcoin Core.
If most node operators and miners adopted the new fork, it would create a “new” Bitcoin network with an uncapped supply. However, Super Testnet argued that this new chain wouldn’t truly be Bitcoin.
“The inflation cap is definitional to Bitcoin,” they said. “Eliminate that, and whatever you have isn’t Bitcoin anymore. You might as well ask what it would take to turn Bitcoin into PayPal.”
In essence, an uncapped version wouldn’t be Satoshi Nakamoto’s Bitcoin.
The question of whether Bitcoin’s 21 million supply cap is truly immutable has resurfaced after BlackRock released a three-minute explainer video on Dec. 17. The video included a disclaimer suggesting there’s no guarantee the cap won’t be altered.
Bitcoin’s fixed supply is a cornerstone of its value as a store of wealth, and any change could fundamentally impact its perception among investors.
In the video, BlackRock highlighted Bitcoin’s 21 million cap, noting it as a “hard-coded rule” that controls supply, purchasing power, and prevents excessive currency creation. However, the disclaimer stated: “There is no guarantee that Bitcoin’s 21 million supply cap will not be changed.”
MicroStrategy chairman Michael Saylor reposted the video, sparking criticism. Joel Valenzuela, Dashpay’s marketing director, commented, “When the supply cap increase happens, it will have ‘always been part of the plan.’ And today, in 2024, people have the audacity to say Bitcoin wasn’t hijacked.”
Ethereum developer Antiprosynthesis added, “BlackRock understands Bitcoin better than Bitcoiners.”
Is Bitcoin’s Supply Cap Changeable?
Bitcoin developer Super Testnet, known for BitVM, explained that altering Bitcoin’s supply cap would depend on how one defines “Bitcoin.”
In theory, the cap could change if a majority of the community—node operators, developers, miners, and investors—reached consensus on a hard fork. Such a change would involve a proposal to gauge consensus, followed by implementing changes in Bitcoin Core.
If most node operators and miners adopted the new fork, it would create a “new” Bitcoin network with an uncapped supply. However, Super Testnet argued that this new chain wouldn’t truly be Bitcoin.
“The inflation cap is definitional to Bitcoin,” they said. “Eliminate that, and whatever you have isn’t Bitcoin anymore. You might as well ask what it would take to turn Bitcoin into PayPal.”
In essence, an uncapped version wouldn’t be Satoshi Nakamoto’s Bitcoin.
Bitcoin briefly slipped below the $100,000 psychological level before reclaiming it, sparking mixed reactions among crypto analysts.
“Bitcoin is developing a bearish engulfing weekly candlestick formation,” pseudonymous trader Rekt Capital shared with their 518,900 followers on X in a Dec. 19 post.
Bearish Pattern Yet to Be Confirmed
Rekt Capital noted that the potential downtrend is not yet set in stone. “There are still a few days until the end of the week to ‘fully confirm’ the downtrend, and ‘lots can change’ in the meantime,” they stated.
“Technically, this is still a dip until Weekly levels are confirmed as lost,” they added.
Between 2 and 3 am UTC on Dec. 19, Bitcoin briefly dipped below $100,000 for the first time since Dec. 13, reaching a low of $99,047, according to CoinMarketCap.
This dip occurred amid a broader crypto sell-off following the U.S. Federal Reserve’s announcement of a 25 basis point rate cut and hints at fewer rate cuts in 2025 than initially anticipated.
Not Everyone Is Concerned
Some traders downplayed the dip. “This pullback is pretty normal for Bitcoin. We’ve had 8 of them since October,” Bitcoin Archive commented on X.
“If you’re selling your Bitcoin in reaction to what the Fed said today, you have no idea what you own,” added crypto commentator James Lavish.
Volatility Is Part of Price Discovery
Bitcoin reached $100,000 for the first time on Dec. 5, driven by ETF demand, the upcoming April halving, and Donald Trump’s election victory.
Rekt Capital reminded traders that volatility is natural in this phase. “Technically, it is Week 7 in Price Discovery, which historically meant that BTC corrections occur around this time,” they said.
While some see such dips as “flash crashes,” Rekt suggested the correction could extend into next week, adding, “We know that Week 7 and Week 8 in Price Discovery have historically been corrective weeks.”
The cryptocurrency community has criticized Coinbase for its explanation of delisting Wrapped Bitcoin (WBTC), linking the decision to “unacceptable risk” associated with Tron founder Justin Sun.
On Dec. 17, Coinbase responded to a lawsuit filed by Sun-affiliated BiT Global, which accused the exchange of harming the WBTC market by removing the token in November.
In its filing, Coinbase cited risks tied to Sun, including allegations of financial misconduct and ongoing regulatory investigations.
“Guilt by Association”
The filing sparked backlash within the crypto community, with many arguing Coinbase failed to provide sufficient legal or technical justification for the delisting.
Critics also pointed out that Coinbase itself has been under several regulatory investigations.
Bitcoin enthusiast and Coinbase skeptic Pledditor took to X on Dec. 17, accusing the exchange of making a decision based solely on personal bias.
“It’s basically just they don’t like Justin Sun,” Pledditor stated, calling it “guilt by association.”
The filing referenced Sun’s alleged misconduct, claiming he has “reportedly violated industry and government standards intended to prevent fraud.”
Coinbase expressed skepticism over BiT Global’s reliability, citing its association with Sun.
“So too is any acknowledgment that he has repeatedly been accused of, investigated for, and sued for financial misconduct, and that reports of his alleged misdeeds abound in the press and crypto community more broadly,” the filing stated.
Sun’s Regulatory Troubles
Justin Sun, founder of the Tron cryptocurrency, has faced numerous legal challenges.
In March 2023, the U.S. Securities and Exchange Commission (SEC) charged him with fraud and securities violations.
He has also reportedly been investigated by the FBI and the Southern District of New York’s prosecutor’s office.
Irony Noted by Critics
Prominent figures like VanEck adviser Gabor Gurbacs pointed out the irony of Coinbase’s actions, given its own legal troubles.
“It’s ironic that Coinbase is treating Justin Tron this way. Coinbase itself is under SEC and numerous other investigations, probably many more than Justin and his businesses,” Gurbacs said in an X post shared by Sun.
Since its launch on January 11, the Grayscale Bitcoin Trust (GBTC) has seen outflows exceeding $21 billion, making it the only spot Bitcoin ETF in the U.S. with a negative net investment flow.
As of December 16, GBTC’s total outflows reached $21.045 billion, with the trust losing an average of $89.9 million daily over the past 11 months, according to Farside Investors.
While 10 other spot Bitcoin ETFs in the U.S. maintain positive net flows, GBTC’s massive outflows surpass the total inflows of nine of these funds combined.
The nine newer funds, including the Fidelity Wise Origin Bitcoin Fund, ARK 21Shares Bitcoin ETF, and Invesco Galaxy Bitcoin ETF, have collectively attracted $20.737 billion since their launch.
In contrast, BlackRock’s iShares Bitcoin Trust (IBIT) has significantly bolstered the market. IBIT alone has brought in $35.883 billion, with daily inflows averaging $153.3 million since its debut.
Despite GBTC’s challenges, the spot Bitcoin ETF market has surged, reaching $35.5 billion in total investments within the year.
Grayscale’s Ethereum Trust ETF (ETHE), launched on July 23 alongside eight other spot Ether ETFs, is also experiencing substantial outflows.
ETHE has lost over $3.5 billion in under six months, following a trend similar to GBTC.
Meanwhile, other Ether ETFs have posted positive inflows, led by BlackRock’s iShares Ethereum Trust ETF (ETHA) with nearly $3.2 billion in investments and Fidelity Ethereum Fund (FETH) with $1.4 billion.
These developments highlight contrasting investor sentiment, as BlackRock continues to dominate the market while Grayscale faces significant investment challenges.
Bitcoin rallied nearly 5% on Dec. 15, reaching a new all-time high of $106,554, fueled by speculation that it may become a U.S. reserve asset.
Data from TradingView shows Bitcoin surpassed its previous high of $104,000, set on Dec. 5, before retracing slightly.
CK Zheng, chief investment officer of ZK Square, attributed the surge to a “Santa Claus mode,” as investors fear missing out and increase their capital allocation to Bitcoin.
Zheng predicted Bitcoin could hit $125,000 by early 2025 but cautioned about a potential 30% correction as much of the bullish sentiment tied to the incoming Trump administration has already been “priced in.”
Such a correction from $125,000 would bring Bitcoin down to approximately $87,500.
Trump Administration Speculation Fuels Rally
The rally follows comments from Strike CEO Jack Mallers, who suggested President-Elect Donald Trump might issue an executive order on Jan. 20, designating Bitcoin as a reserve asset.
“There’s potential to use a day-one executive order to purchase Bitcoin,” Mallers said, though he clarified, “It wouldn’t be the size and scale of 1 million coins, but it would be a significant position.”
Meanwhile, Dennis Porter, CEO of the Satoshi Action Fund, revealed that a third Bitcoin reserve bill is in progress at the state level, joining similar measures in Texas and Pennsylvania.
“We’re going to see more and more of these bills come. At least 10, in my opinion,” Porter said during a Dec. 15 X Spaces discussion.
Additional Catalysts for Bitcoin’s Surge
Financial analysts are also anticipating a 0.25% interest rate cut by the U.S. Federal Reserve on Dec. 18, which could further boost Bitcoin.
Additionally, a new Financial Accounting Standards Board rule taking effect after Dec. 15 allows institutions to more accurately report the value of their crypto assets, potentially attracting more institutional investors.
The Crypto Fear and Greed Index currently ranks market sentiment in the “Extreme Greed” zone at 83 out of 100.
Michael Saylor, the mastermind behind MicroStrategy’s Bitcoin investment strategy, hinted that the company may have added more Bitcoin to its holdings over the weekend.
In a Dec. 15 post to X, Saylor questioned whether the SaylorTracker portfolio tracker was “missing a green dot,” implying another Bitcoin purchase by the firm.
Consistent Purchasing Pattern
Saylor has shared the SaylorTracker chart on five consecutive Sundays since Nov. 10, with Bitcoin purchases being confirmed the following Monday each time.
If confirmed for a sixth time, this purchase would mark MicroStrategy’s first acquisition at an average Bitcoin price exceeding $100,000.
According to CoinGecko, Bitcoin hasn’t traded below six figures since 5:00 pm UTC on Dec. 13.
MicroStrategy previously reported buying Bitcoin at average prices of $97,862, $95,976, and $98,783 over the past three Mondays, from Nov. 25 to Dec. 9, according to SaylorTracker data.
A new purchase at similar levels would bring the company closer to reaching a $50 billion Bitcoin portfolio.
As of Dec. 15, MicroStrategy held 423,650 Bitcoin, valued at over $43.6 billion.
Bitcoin Milestones and Market Impact
This potential purchase came just a day before Bitcoin reached a new all-time high of $106,554.
Saylor has made it clear the company won’t slow down its Bitcoin buying spree, stating he’s “sure” MicroStrategy will continue purchasing even at a price of $1 million per Bitcoin.
MicroStrategy’s Stock Performance
MicroStrategy’s (MSTR) stock has soared 496.4% year-to-date, according to Google Finance.
The impressive performance has earned the company a spot in the Nasdaq-100, a prestigious index comprising the 100 largest non-financial companies listed on Nasdaq.
With its consistent investments, MicroStrategy remains a major force in the Bitcoin ecosystem.