Will Bitcoin Price Rally Reach $120K With New US Crypto Policy?
While Bitcoin price is still trading above $100,000, the crypto market is keeping an eye on a recent executive order.
Signed by President Donald Trump, it seeks to establish a digital asset fund also known as Bitcoin.
This is a clear indication of government adoption of cryptocurrencies and may signal a shift in the direction of Bitcoin price and market trends.
Governmental Endorsement and Market Stability
Notably, the US plan to hold cryptocurrencies shows how digital assets are being incorporated into conventional economic systems. It also indicates a possible increase in the Bitcoin price in the market.
Additionally, historical data indicates that the same type of endorsement or rejection by other authoritative bodies has resulted in prompt and significant fluctuations in the cryptocurrency value.
As the U.S. government has backed this, cryptocurrency enthusiasts are hopeful that Bitcoin may reach $120,000 in the current fiscal quarter.
At the date of the announcement, the price of Bitcoin slightly rose, and experts claim that the market’s reaction to the new policy was rather cautious.
While the long-term impact of these changes is still unknown, the initial response of the market is relatively positive. This has enabled Bitcoin to continue holding the ground above the $100K mark.
Analysis of Open Interest and Market Liquidity
Bitcoin Open Interest, a derivative instrument that measures the total number of contracts that have not been closed, has risen to $67.52 billion as of January 24, 2025.
This increase in Open Interest comes at the same time that the government has made an announcement, indicating that investors may be returning to the market and that there might be an increase in liquidity.
In general, market sentiment is bullish when the price rises while Open Interest increases. This means that there is new buying pressure coming into the market, which could be due to
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