According to a report by crypto asset management firm Sygnum, institutional investor-led ‘demand shocks’ could propel Bitcoin (BTC) prices to new highs in 2025. However, altcoins may underperform due to factors such as reduced capital rotation from BTC to other cryptocurrencies.
Bitcoin Likely To Continue Its Momentum Into 2025
In a report titled Crypto Market Outlook 2025, asset manager Sygnum outlined multiple factors that are likely to further push BTC price upwards next year. The report highlights new capital inflows into the market – particularly institutional inflows – as the primary driver for the crypto bull market in 2025.
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The analysis highlights a ‘multiplier effect’ caused by institutional inflows combined with Bitcoin’s limited liquid supply. For instance, every $1 billion of net inflows into spot BTC exchange-traded funds (ETFs) reportedly triggers a 3-6% price increase.
Additionally, the report notes that Bitcoin’s price momentum is amplified by the concept of reflexivity – demand for BTC grows as its price rises, creating a feedback loop. Together, institutional inflows, the multiplier effect, and Bitcoin’s reflexivity are expected to make 2025 a pivotal year for the cryptocurrency.
The report also emphasizes the importance of a pro-crypto regulatory climate in the US, following the confirmation of Donald Trump’s victory in the November presidential election. The outcome is widely seen as favorable for crypto legislation, with expectations of a comprehensive regulatory framework that could provide much needed clarity for the industry.
The election outcome bodes well for crypto legislation, with widespread expectation of the establishment of a comprehensive regulatory framework, which includes clarifying the status of crypto assets and defining the roles of the regulatory bodies. It is expected that the CFTC’s role in crypto oversight will be extended, and the chances of the various crypto bills passing and being written into law have increased substantially.
Some of the major crypto bills that will be in focus are The Payment Stablecoin Act, The Bitcoin Act – which compels the US government to build a strategic BTC reserve – The CBDC Anti-Surveillance Act, and several other bills that support crypto self-custody, crypto mining, and decentralized finance.
2025: A Watershed Year For BTC
The report…
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