During the past week, the Bitcoin price achieved a significant milestone by topping $107,000 for the first time. This event came amid speculations about how President-elect Donald Trump might initiate the creation of a U.S. strategic Bitcoin reserve upon taking office. Additionally, MicroStrategy's (MSTR) inclusion in the Nasdaq 100 and its QQQ ETF marked another important validation of Bitcoin as an investment.

Bitcoin's $100,000 Milestone: What Does It Mean For Investors?

The Bitcoin price's ascent to $107,000 is a remarkable development that has captured the attention of investors worldwide. Bitcoin, the world's largest cryptocurrency, has seen a staggering surge of around 150% this year. Its previous all-time high near $103,900 from Dec. 5 was surpassed, reaching as high as $106,491 late Sunday and then rising to $107,778 on Monday afternoon before pulling back slightly below $106,000.This significant price increase has led many investors to wonder about the implications and future prospects of Bitcoin. Some see it as a sign of the growing acceptance and recognition of cryptocurrency as a legitimate asset class. Others are cautious, considering the volatility and uncertainties associated with the market. MicroStrategy's massive Bitcoin bet, which has so far paid off with a paper profit of about $19 billion, adds another layer of interest and speculation.

Bitcoin Strategic Reserve Funding?

During the campaign, Trump discussed a $20 billion Bitcoin reserve and gave every indication that it was still on the table during a CNBC interview. Asked by CNBC's Jim Cramer about a Strategic Petroleum Reserve for crypto, Trump responded affirmatively, stating, "Yeah, I think so. We're going to do something great with crypto."Rep. Cynthia Lummis, Wyo.-R, has proposed that the U.S. government buy 1 million bitcoin over five years, currently costing over $100 billion based on today's price. However, this requires buy-in from Congress. In recent days, some cryptocurrency industry insiders have suggested how Trump might proceed to establish a bitcoin reserve.Strike CEO Jack Mallers said on Tim Pool's podcast that Trump plans to sign an executive order on Day One establishing a bitcoin reserve. "People are looking at the dollar stabilization act as it gives the president wide discrepancy to protect the dollar." Satoshi Action Fund CEO Dennis Porter, a crypto advocacy organization, provided even more detail, posting, "I can confirm that Trump is exploring an Executive Order creating a 'Strategic Bitcoin Reserve.'" Porter also said Trump is exploring the use of the Exchange Stabilization Fund for buying Bitcoin.

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Exchange Stabilization Fund Facts: The Exchange Stabilization Fund was established via the Gold Reserve Act of 1934 and amended in the late 1970s. It conducted gold transactions up through 1971. The act provides that the Department of the Treasury has a stabilization fund to facilitate an orderly system of exchange rates. The ESF "with the approval of the President, may deal in gold, foreign exchange, and other instruments of credit and securities."Bitcoin popped as high as $106,491 late Sunday and surpassed its previous all-time high. After easing back, it got a second wind and rose as high as $107,778 on Monday afternoon. Meanwhile, MicroStrategy is set to join the Nasdaq 100 index effective Dec. 23. The addition of MSTR means that ETFs, including the highly-popular Invesco QQQ Trust, will become automatic buyers. MSTR rose as much as 7% but finished fractionally lower in Monday's stock market action. Among other crypto-related plays, Coinbase stock rose 1.5%, Robinhood 7.5%, and MARA Holdings (MARA) 8.1%.MicroStrategy's massive Bitcoin bet has so far been profitable, with the company acquiring 439,000 Bitcoin for $27.1 billion or $61,725 per Bitcoin, leaving a paper profit of about $19 billion. However, the stock has an $83 billion market capitalization despite its enterprise software business losing money.Be sure to read IBD’s The Big Picture column after each trading day to get the latest on the prevailing stock market trend and what it means for your trading decisions.