Crypto Biz: The Year of Bitcoin

Bitcoin has had such a historic year! Almost 16 years after the network's launch, the cryptocurrency solidified its status as a major financial instrument in January with the approval of 11 exchanges.

The launch of ETFs marked one of the most successful debuts in history thanks to institutional interest, with a Bitcoin-focused fund attracting more than $113.5 billion by the end of the year. This flow helped the price of Bitcoin (BTC) hit a record high of $100,000 in December, sustained mostly by professional buyers.

The impact was felt across the broader market, with institutional investors leading over-the-counter (OTC) transactions. For example, the Kraken exchange saw a 220% year-over-year growth in OTC markets. “From a long-term perspective, OTC is going gangbusters right now,” said Tim Ogilvie, Kraken's head of institute.

In the year By the end of 2024, institutional adoption will expand beyond ETFs, with publicly traded companies placing bitcoin on their balance sheets – a move that could prove both a good hedging strategy and a flexible investment.

Microstrategy has been leading this approach since 2020 and has collected more than 444,000 bitcoins in its treasury. On Dec. 23, the company filed a proxy with the United States Securities and Exchange Commission to seek shareholder approval to expand bitcoin purchases through 2025.

Some might say that Bitcoin is far from the norm at the moment.

This week's CryptoBiz also explores Crypto.com's new escrow service, Russian partial crypto mining, and taxes on depositing rewards in the US.

MicroStrategy calls a shareholder meeting to fund additional Bitcoin purchases

MicroStrategy has called a special meeting of shareholders to expand its equity issuance plan and seek funding for additional Bitcoin purchases. The company plans to increase its authorized share of Class A stock and preferred stock, which will allow for greater flexibility in raising capital. The microstrategy behind the move is the 21/21 plan, which seeks to buy an additional $42 billion worth of bitcoin over the next three years through equity sales and raising fixed income securities. Microstrategy has purchased more than 444,000 BTC since December 24th in a plan to accelerate the purchase of the coins. The company sees its stock value jump more than 420 percent by 2024, largely due to its Bitcoin strategy.

Crypto.com launches US institutional protection service

Crypto.com has launched an institutional cryptocurrency custody service in the US as part of its expansion efforts. Called Crypto.com Security Trust Company, the service is intended to provide security solutions to US institutions and high-net-worth individuals. Digital assets owned by US and Canadian customers will be gradually transferred to the new trust company. This move is in line with Crypto.com's goal to strengthen its presence in North America, including the US and Canada. In December, US President-elect Donald Trump met with the company's CEO Chris Marszalek at Trump's home in Mar-a-Lago to discuss crypto policies.

Russia bans crypto mining in 10 regions for 6 years

Russia has approved a six-year ban on cryptocurrency mining in 10 regions starting January 1, 2025 and lasting until March 2031. This decision includes areas such as Dagestan, Chechnya, and parts of Dneetsk. In addition, Irkutsk, Buryatia and Zabaikalsky regions are subject to seasonal restrictions from November to March every year to prevent energy shortages. The restrictions and bans are meant to balance energy consumption and the growth of the crypto industry, although key mining regions like Irkutsk will only see partial restrictions rather than full bans. Earlier proposals were refined if the bans included broader mining bans.

IRS doubles down on crypto staking tax: Report

The IRS rejected arguments in a second lawsuit filed by Joshua and Jessica Jarrett, affirming its position that cryptocurrency rewards are taxed upon receipt, not when they are sold. The couple wanted to treat their stock award as an asset, taxable only when sold. However, the IRS considers prizes to be taxable income at their market value when received. The case could set a significant precedent for how awards are paid out in the US. This legal challenge to Jarrett's, which began in 2021, will see continued taxes on rewards from Tezos tokens.

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