What’s behind Bitcoin’s historic rise to $108,000? From Trump’s speech to ETFs and MicroStrategy’s massive buys, could a major institutional supply squeeze be underway?

Bitcoin (BTC) has once again stolen the spotlight. On Dec. 17, BTC climbed to an all-time high of $108,260, pushing its post-U.S. election gains to over 50%.

Bitcoin (BTC) price hit a new all-time high of $108,260 on Dec. 17, continuing its impressive rally following the U.S. election. As of this writing, BTC price is trading around $106,663. Several factors are driving Bitcoin's new highs, including President-elect Donald Trump's proposal to establish a U.S. Bitcoin strategic reserve. During his speech at the New York Stock Exchange on December 12, Trump outlined his vision for America to "do something great with crypto" and build reserves similar to the existing strategic oil stockpile.

Another key factor is the increasing institutional activity, particularly from MicroStrategy, which is known for its aggressive Bitcoin accumulation strategy. In the past week alone, MicroStrategy announced that it had purchased $1.5 billion worth of BTC at an average price of $100,386 per coin. This recent acquisition brings the company's total Bitcoin holdings to 439,000 BTC, valued at around $47 billion. MicroStrategy's Bitcoin strategy has paid off immensely, catapulting its market cap from $1.1 billion in 2020 to nearly $100 billion today. Furthermore, MicroStrategy's inclusion in the Nasdaq 100 index, effective next week, is also expected to boost further demand for its stock as funds and ETFs rebalance their portfolios.

Meanwhile, Ethereum (ETH) price also showed strong signs of life after a period of stagnation, climbing to a seven-day high of $4,106 on December 16—a 6% weekly gain. While ETH faced some minor retracement due to profit booking, it remains around the $3,950 mark as of this writing.

Let’s dive deeper into the key developments impacting Bitcoin and Ethereum, analyze the macroeconomic indicators shaping this bull run, and see what experts have to say about what could happen in the coming days.

Bitcoin price hits new highs, institutional demand fuels the rally

Both Bitcoin and Ethereum are displaying strong momentum, but the underlying story becomes clearer when we look at ETF inflows, liquidations, and futures open interest. Spot Bitcoin ETFs have seen consistent inflows this month. Since December began, they’ve seen daily inflows every single day, adding over $5.16 billion as of Dec. 16. These inflows have pushed the total assets under management for Bitcoin ETFs to $123 billion — a strong signal of confidence, especially from institutional investors.

Ethereum ETFs, however, tell a different story. Between their launch on Jul. 23 and Dec. 3, inflows were modest, reaching just $733.6 million. Compared to Bitcoin’s performance, this figure looks miniscule. But momentum has clearly shifted. Since Dec. 4, Ethereum ETFs have seen consistent inflows, adding $1.58 billion in a matter of days, suggesting that investors are warming up to Ethereum, likely encouraged by its price performance and Bitcoin’s strong market lead.

Now, let’s take a look at the liquidation data to add more context to what's happening in the market. Over the last 24 hours, as of Dec. 17, $339 million worth of positions were liquidated across the crypto market, with $205 million in longs and $134 million in shorts wiped out. For Bitcoin, total liquidations have been around $60 million, with short positions making up the majority at $30 million, compared to $29 million from longs, suggesting that many traders betting against Bitcoin’s rally were forced out of their positions as BTC climbed past $108,000. Ethereum saw even heavier liquidations, totaling $78.5 million, with shorts again taking a larger hit at $52 million, reflecting how ETH's recent price push to $4,100 surprised many bearish traders.

Bitcoin futures open interest — the total value of outstanding futures contracts — has also seen monumental growth. Back in early October, open interest sat at $32 billion. Following Trump’s election victory and the resulting bullish sentiment, that figure grew rapidly, reaching $55 billion by mid-November. Since then, open interest has continued to climb, hitting a massive $70 billion as of December 17. Rising open interest paired with increasing prices is a bullish signal, as it shows new money flowing into the market and traders placing bets on further upside.

Put simply, Bitcoin’s rally isn’t running on fumes. ETF inflows are strong, futures activity is rising, and short sellers are being squeezed out of their positions. Ethereum, while slower to catch up, is now benefiting from the same momentum, with growing ETF inflows and shorts being liquidated. Both assets appear to have solid footing for their current uptrends, with institutional money and futures markets aligning to paint a bullish picture.