Bitcoin News Today: ETFs vs. Treasuries: The Structural Battle Reshaping Bitcoin's Price Path

The U.S. Federal Reserve's looming rate-cut decisions have intensified speculation over Bitcoin's next move, with traders and institutions closely watching whether BTC can reclaim its $91,000 threshold. However, the path to higher prices may hinge on structural shifts in how institutional capital flows into crypto, driven by regulatory actions and evolving market dynamics. MSCI's consultation on excluding digital-asset treasuries from equity indexes has sparked a broader debate about the role of Bitcoin in traditional portfolios, with potential implications for liquidity, ETF dominance, and the price trajectory of BTC.

At the heart of the debate is MSCI's proposal to exclude companies whose crypto holdings exceed 50% of total assets from its Global Investable Market Indexes according to reports. This move, if adopted, would force passive funds to sell billions in exposure to firms like Strategy (MSTR), which holds over $9 billion in crypto. JPMorgan estimated that a reclassification of MSTR alone could trigger $2.8 billion in outflows, with a broader sell-off of up to $8.8 billion if other index providers follow suit. The consultation, set to conclude in late 2025, reflects a growing institutional recognition of the risks inherent in proxy stocks-companies that hold Bitcoin but lack operational revenue streams. Such firms, now numbering over 200 in the U.S., according to DLA Piper, have grown from $40 billion in market cap in 2024 to $150 billion in 2025. Yet, their reliance on convertible debt and the risk of forced liquidations when equity prices dip below crypto valuations has created a fragile ecosystem.

Meanwhile, Bitcoin's exposure is increasingly migrating to regulated ETFs, which now manage over $100 billion in assets, including BlackRock's IBIT, which holds 6.8% of BTC's circulating supply according to analysis. This shift is accelerating as MSCI's proposal pushes capital away from equity-linked treasuries into ETFs, which offer purer BTC exposure without the balance-sheet risks. For Bitcoin itself, this rotation could be neutral or positive if ETF inflows offset treasury sell-offs, but it poses liquidity challenges for the affected stocks. The structural advantage of ETFs-being almost exclusively BTC-focused-also reinforces Bitcoin's dominance over other tokens, even as some treasuries experiment with Solana or Ethereum according to reports.

Macro factors further complicate the outlook. The Fed's December rate decision, with a 78% probability of maintaining rates above 3.5%, remains pivotal. A dovish pivot could boost risk appetite, while softer labor data or AI investment trends might delay cuts. Additionally, regulatory easing and MSCI's final ruling on DATs could reshape market sentiment. Michael Saylor of MSTR has defended the firm's status as an operating company, but smaller treasuries may lack the luxury of such arguments, potentially forcing them to scale back purchases or liquidate holdings.

Derivatives markets also signal caution. The $13.3 billion monthly options expiry, with a put-call ratio of 0.66 and a "max pain" level at $102,000, highlights the defensive positioning of traders. The $80,000 put option, now the most popular on Deribit, reflects bearish bets as volatility remains elevated. Meanwhile, Bitcoin's correlation with the S&P 500, which has historically exceeded 70%, suggests its price movements are increasingly tied to broader equity trends.

Looking ahead, Bitcoin's ability to break $91,000 will depend on a confluence of factors: the Fed's policy path, the resolution of MSCI's DAT review, and the stability of derivatives markets. A shift in capital from treasuries to ETFs could provide a tailwind, but liquidity risks and forced selling from underperforming stocks could act as headwinds. For now, the market remains in a delicate balancing act, where structural changes and macroeconomic signals will determine whether Bitcoin's next move is upward or downward.