From a mere technological curiosity to one of the most sought-after assets globally, Bitcoin's journey continues to surprise. Dive into the mechanics behind Bitcoin's meteoric rise, with insights from a leading crypto strategist. Some foresee its peak at $200,000.
Bitcoin (BTC) has crossed the $94,000 mark, driven by a wave of macroeconomic and geopolitical dynamics analyzed by Matt Mena, a crypto research strategist at 21Shares.
This spectacular breakthrough is not just a speculative craze but the result of a combination of structural and institutional factors redefining the role of Bitcoin in investment portfolios. As the crypto market regains a total market capitalization of $3 trillion, here are the forces driving BTC to new highs and the outlook for 2025.
Matt Mena attributes the surge of Bitcoin to a “combination of macro and structural catalysts.” Among them, a calming of geopolitical tensions, notably a more conciliatory diplomatic stance of Donald Trump towards China, and the confirmation of Jerome Powell’s continuity at the helm of the Federal Reserve.
These signals, combined with a weakening dollar, create a favorable environment for risk assets. However, Bitcoin stands out. “This rally is not driven by individuals but by a strategic positioning of institutional capital anticipating a new monetary and political regime,” explains Mena.
Bitcoin also diverges from traditional markets. “Its 7-day correlation with the S&P 500 and Nasdaq has turned negative,” notes Mena, a sign that it is no longer seen as a mere technological proxy. It is evolving towards a “hybrid macro asset,” composed of “80% digital gold and 20% technological growth.” This transformation is reflected in financial flows: Bitcoin and Ethereum ETFs attracted $1.3 billion in just two days.
As a result, the speed of this increase caught many traders off guard. Over $500 million of short crypto positions were liquidated, prompting a reassessment of strategies. However, Mena warns: “In the short term, resistance around $105,000 could hinder progress, but the psychological threshold of $120,000 is within sight.” The overall crypto market is revisiting its 2020-2021 peaks, driven by favorable economic indicators, with 10-year bond yields close to 4% reinforcing Bitcoin’s appeal as a safe haven asset.
Mena sees a potential doubling of Bitcoin by the end of the year, with an ambitious target of $200,000. This scenario is based on global liquidity dynamics, similar to previous bullish cycles, and expectations of three to four interest rate cuts by late 2025. “Investors are looking beyond volatility,” states Mena. “Bitcoin is becoming a safe haven against uncertainties in traditional markets.”
To benefit from this trend, Mena recommends a disciplined approach: investing gradually to smooth volatility and favoring regulated platforms. He also advises keeping an eye on on-chain data, such as wallet activity, to anticipate market movements. With strong fundamentals and increasing institutional adoption, Bitcoin emerges as a crucial asset for 2025.
Charles Ledoux is a Bitcoin and blockchain technology specialist. A graduate of the Crypto Academy, he has been a Bitcoin miner for over a year. He has written numerous masterclasses to educate newcomers to the industry and has authored over 2,000 articles on cryptocurrency. Now, he aims to share his passion for crypto through his articles for InvestX.
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