Bullish predictions abound for Bitcoin's price as the new year approaches. 2025 looks promising for Bitcoin (BTC), or so a multitude of predictions forecasting new all-time highs (ATH) for this asset would suggest.
From amateur traders to experienced analysts and large corporations, there is a shared bullish outlook for the digital currency in the coming year. However, price forecasts vary.
According to Standard Chartered Bank, Bitcoin is expected to peak at $250,000 in 2025, settling around $200,000 by year-end. This forecast is based on projections that Bitcoin ETFs will see inflows of $75 billion.
"We believe it will follow a halving cycle similar to what we've seen in the past, which would imply around $250,000 for Bitcoin in 2025," stated Tom Lee, Head of Research at asset management firm Fundstrat Capital.
Bitcoin has consistently shown a strong upward trend following each halving. This event, which cuts the coin's issuance rate in half every four years, naturally drives up its value due to increased demand. With the latest halving having occurred in 2024, enthusiasm for this year is high. While a halving does not guarantee a price increase, it facilitates one by reducing the miners' potential supply. Thus, this attribute is one of Bitcoin’s main draws, attracting more investors to the market. Asset management company Bitwise forecasts that Bitcoin will reach $200,000 by 2025. However, it notes that if the U.S. government proceeds with its proposal to hold 1 million units of BTC, the price could soar to $500,000 or more.
Adam Back, co-founder and CEO of BlockStream, is even more ambitious. "If the U.S. strategic Bitcoin reserve materializes, brace for a seven-figure Bitcoin in this cycle," he exclaimed.
Nonetheless, this greedy projection is far from the aims of most predictions for 2025. Yet, bulls do not rule out the possibility of Bitcoin eventually reaching a million dollars, as suggested by Cathie Wood, CEO of ARK Invest, though she expects this to occur by 2030.
For Ark Invest, if institutional investors allocate between 1% and 4.8% of their portfolios to digital currency, Bitcoin's price could soar to between $120,000 and $550,000. This scenario becomes more likely with the advent of BTC ETFs last year in the United States, the world's leading economic power. Recent interest rate cuts also imply greater liquidity in the economy, which could facilitate capital inflow into the markets. Moreover, the beginning of Donald Trump's presidential term in the United States this year adds an optimistic hue due to better economic expectations and his intention to boost the cryptocurrency industry.
A common target for Bitcoin in 2025 is $200,000: Despite varied projections, several forecasts converge around $200,000 as the peak for 2025. One such believer is investment management firm Bernstein, driven by the growing allocation in investment portfolios.
Indeed, according to Gautam Chhugani, analyst at Bernstein, Bitcoin will surpass gold as the premier asset over the next decade, becoming the "reserve of value for the new era." "It will become a permanent part of the multi-asset institutional allocation and a standard for corporate treasury management," he asserted.
Asset Under Management (AUM) of major asset managers and Bitcoin ETFs. Source: Téllez.
In correlation, Argentine investor Norberto Giudice believes that, with Trump's electoral victory, a super bullish cycle for Bitcoin is forming, which could push its price close to $200,000. Given the duration of previous bull runs, he projects such a peak by the end of next year.
While some see even higher prices, crypto trader and analyst Juan Téllez estimates that Bitcoin's market cap will rise to $5.7 trillion in this bull cycle, nearly four times larger than it is currently. This would propel BTC's price to $285,000, he warns.
However, Téllez does not discount an even more bullish scenario where the market cap reaches $12 trillion, and consequently, Bitcoin’s price hits $600,000. "I know it's hard to believe; at least it's hard for me to believe," he clarifies. But, as a defense, he recalls that in each BTC cycle, few predicted the peaks it would reach.
In the past, the digital currency has seen four-digit percentage increases. However, it's important to recognize that the level of BTC's rise has diminished in each bullish cycle. This is due to its growing capitalization, which lessens its price volatility against trading volumes. Thus, it is crucial to consider that, as the market matures, gains like those seen in past times may not occur. Nonetheless, this signifies something positive for investors, as it implies a lower risk of bearish volatility than in the currency’s early days.
