Bitcoin Price Rises Amid Rumors of Venezuela's Secret Reserve

By Omkar Godbole (All times ET unless indicated otherwise) The new year has started on a positive note for crypto, with Bitcoin currently trading near $92,700, representing a 1.3% increase over the past 24 hours and a 5% gain since the beginning of the year. Major alternative cryptocurrencies such as XRP, SOL, BNB, and ETH have also experienced gains, ranging from 1% to 3% over the past day. The CoinDesk 20 Index (CD20) has risen by 1.25%, indicating strength in the most prominent and active assets, while the CoinDesk 80 Index (CD80) has relinquished its initial gains, suggesting relative weakness in the broader altcoin market. According to analysts, the increase in Bitcoin's price can be attributed to safe-haven demand following the U.S. action in Venezuela and the exhaustion of tax-related selling. Data from Deribit reveals renewed demand from traders for bullish option bets, particularly the $100,000 strike call. Laser Digital informed CoinDesk via email that "we observed ETF inflows on January 2nd, following consecutive outflows in December, and 3000x lots of Jan-end BTC calls were executed on the last day of December." Over the weekend, the U.S. launched an attack on Venezuela, capturing President Nicolás Maduro. Since then, speculation has emerged on crypto social media that Venezuela may be in control of a massive, unverified shadow reserve of over $60 billion in Bitcoin, potentially comparable to that held by the Bitcoin treasury company MicroStrategy (MSTR), which holds BTC worth over $62 billion. If this claim is true, the U.S. might seize these coins and add them to its strategic BTC reserve, which could reduce the likelihood of forced selling and highlight Bitcoin's growing strategic importance as nations compete to accumulate it. QCP Capital stated in a market note on Monday that "the prospect of the U.S. adding any seized BTC to its own strategic reserve reduces the likelihood of forced selling and underscores BTC's rising strategic importance as nations compete to accumulate." Another trending narrative suggests that President Donald Trump could soon tap into Venezuela's 300 billion barrels of oil reserves, potentially increasing supply and leading to a crash in oil prices. This, in turn, could enable the Federal Reserve to cut interest rates more rapidly. However, analysts point out that having reserves and actually producing them are two different things. Venezuelan crude from the Orinoco Belt is heavy, impure sour crude, making it difficult and expensive to extract and refine, requiring significant investments. As a result, the reserves may not be tapped into in the near future, limiting their impact on oil prices. In other words, the anticipated disinflationary impulse may not materialize anytime soon. In other key news, Ethereum co-founder Vitalik Buterin announced that the network has effectively solved the blockchain scalability trilemma, achieving a balance between decentralization, security, and high transaction speed, thanks to key upgrades like zkEVMs and PeerDAS. In traditional markets, the dollar index rose for the fourth consecutive trading day, surpassing 98.50. Futures tied to the S&P 500 and Nasdaq 100 traded higher. This week, a flurry of key U.S. data releases is expected, starting with the ISM Manufacturing PMI later today, followed by the non-manufacturing PMI, the ADP Employment report, and nonfarm payrolls data in the days ahead. Stay alert! Read more: For analysis of today's activity in altcoins and derivatives, see Crypto Markets Today What to Watch Token Events Conferences Market Movements Bitcoin Stats Technical Analysis Crypto Equities Crypto Treasury Companies ETF Flows Spot BTC ETFs Spot ETH ETFs Source: Farside Investors While You Were Sleeping