Bitcoin’s remarkable rally in 2024 stunned the world but with the advent of the new year only hours away, the rally seems to be stalling.
The cryptocurrency, which surged to a record high of $108,000 in mid-December, was trading at $93,670 early Monday in New York, 16% below the high.
Smaller tokens like Ether and meme favourite Dogecoin have also struggled to gain traction in recent days.
The BTC rally was fuelled by the US election results owing to President-elect Donald Trump’s favourable stance toward cryptocurrencies.
Investors loaded up on the cryptocurrency driven by Trump’s proposals of building a national Bitcoin reserve and making the regulatory environment easier for crypto firms.
A month later, he named Paul Atkins as the new Securities and Exchange Commission (SEC) chair who will replace Gary Gensler, known for bringing more than a hundred actions against crypto firms during his tenure.
However, the enthusiasm has gradually been tempered by reduced expectations of Federal Reserve interest-rate cuts, which have cooled speculative activity across financial markets.
Chris Weston, head of research at Pepperstone Group, said that “the momentum has come out of the post-election move” in Bitcoin, citing outflows from exchange-traded funds focused on the cryptocurrency as evidence of this slowdown.
At the same time, MicroStrategy, the software company turned Bitcoin accumulator, has been on a buying spree in recent weeks.
With over $40 billion in Bitcoin holdings, the company is closely watched by traders, who anticipate regular announcements of new purchases.
Invezz takes a look at the many aspects that might shape Bitcoin’s price trajectory in 2025, and the many milestones it could possibly touch:
BTC 2025 outlook: Experts weigh in
Despite the current stall, analysts maintain a largely optimistic view of Bitcoin’s future.
Alex Thorn, head of research at Galaxy Digital, dismissed the recent pullback as a temporary blip.
Thorn predicts that Bitcoin will surpass $150,000 in the first half of 2025 and potentially “test or best” $185,000 by the end of that year.
“A combination of institutional, corporate, and nation state adoption will propel Bitcoin to new heights in 2025,” Thorn wrote, adding,
Throughout its existence, Bitcoin has appreciated faster than all other asset classes, particularly the S&P 500 and gold, and that trend will continue in 2025.
Not all market observers share this bullish outlook.
Rania Gule, an analyst at XS.com, warned on Monday that Bitcoin could slide to $85,000 in the near term due to the expiration of approximately $14 billion worth of options contracts.
Blockware’s scenarios for BTC’s 2025 price
Blockware Research has outlined three potential trajectories for Bitcoin’s price in 2025, depending on macroeconomic and policy developments:
Bear Case: Bitcoin could rise modestly to $150,000, and this scenario would take place if the Fed kept interest rates higher for longer, and long-term holders started aggressively selling their Bitcoin.
The bull-run could also be hindered by a failure of the Trump administration to act on the Strategic Bitcoin Reserve Plan.
Base Case: Bitcoin reaches $225,000, supported by Federal Reserve rate cuts, steady corporate adoption, and the establishment of Bitcoin as a US reserve asset through the SBR initiative.
Bull Case: Bitcoin soars to $400,000, driven by ultra-dovish Federal Reserve policies, accelerated corporate adoption, and a significant expansion of the US government’s Bitcoin reserves.
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