The cryptocurrency market experienced a significant decline in 2025, erasing previous gains despite initial optimism fueled by Donald Trump's pro-crypto policies. Market value dropped by $1 trillion, with bitcoin's price falling from an all-time high of $126,000 to around $90,000, amid geopolitical tensions, macroeconomic factors, and industry-specific challenges. Despite the downturn, some industry leaders remain optimistic about the long-term prospects of crypto.
Bitcoin has rebounded after a 20% drawdown, raising questions about whether the crypto winter is over or just beginning, amidst ongoing market volatility.
Bitcoin has dropped to the $67,000 level, while Gemini has returned over $2 billion to its users. James Davies, co-founder of Crypto Valley Exchange, discusses why the crypto winter was an opportune time to start his exchange and shares insights from Consensus 2024.
Bitcoin's halving event, which reduces the rate of new bitcoins being created, historically leads to significant price spikes followed by major corrections, known as "crypto winters." Potential reasons for post-halving crashes include profit-taking by long-term investors and mining capitulation. Despite these cyclical corrections, Bitcoin has shown resilience and the ability to recover. Traders like MicroStrategy's Michael Saylor advocate for a long-term investment horizon, while historical trends suggest bearish periods following halvings. With the fourth halving approaching, the crypto community eagerly anticipates potential implications, as the landscape today differs from past events.
Despite a year filled with high-profile crackdowns and collapses in the cryptocurrency industry, the value of Bitcoin has more than doubled in 2023, and even speculative cryptocurrencies like Solana have seen significant boosts. The industry faced inquiries and charges from regulatory bodies such as the SEC and the Department of Justice, leading to trials and guilty verdicts for prominent figures like FTX founder Sam Bankman-Fried. However, the market continues to attract attention and investment, with hopes of Bitcoin exchange-traded funds being approved in 2024. The year serves as a reminder that the cryptocurrency industry is not immune to fraud and market volatility, but it also demonstrates the enduring appeal and potential of the technology.
The recent rally in crypto prices, with Bitcoin surpassing $40,000, suggests that the Crypto Winter is over. However, one key element of past bull markets is missing: app downloads. In previous boom years, consumer crypto apps soared in popularity, but this time around, Coinbase is ranked low on app charts. This could be due to lagging consumer interest, people being cautious after the last cycle, or a dwindling pool of new customers. If Coinbase and others can't attract more customers, the crypto market may not experience the same dramatic growth as before, despite the support of Wall Street giants.
Bitcoin has experienced a significant bounce, reaching the $43,000-$46,000 range, up 159% from last December, indicating the start of a new cycle. The absence of hype and excitement suggests that there is still room for growth, with sidelined retail investor sentiment and ample capital. Several factors are driving this upward trend, including the possibility of the Federal Reserve cutting rates in March 2024 and pending applications for Bitcoin exchange-traded funds from BlackRock and Fidelity. If approved, this would mark the first Bitcoin ETF. A potential turning point could be Bitcoin crossing the psychological threshold of $50,000, attracting more retail investor capital. Additionally, there is optimism surrounding Coinbase's recovery and its app's ranking on the Apple store. However, not everyone shares this optimism, as JPMorgan CEO Jamie Dimon recently expressed his skepticism towards cryptocurrencies.
Bitcoin's rapid gains paused as traders took profits on a week-long rally driven by hopes of a spot exchange-traded fund (ETF) approval in the U.S. Major tokens showed mixed movement, with Cardano slipping 2% and Solana adding 3%. The CoinDesk Market Index (CMI) rose slightly, indicating overall market gains. Traders believe signs of institutional adoption may signal the end of the "crypto winter." BlackRock's actions, including a DTCC listing and tickerization, fueled anticipation for a spot bitcoin ETF, but some believe the SEC will wait to approve multiple managers simultaneously.
Bitcoin experienced a rapid surge, surpassing $35,000 in just a few minutes, reaching levels last seen in May 2022. The improved mood in the crypto market is largely driven by the anticipation of Bitcoin ETFs, which could make it easier for investors to buy BTC. Grayscale, the largest exchange-traded bitcoin product, is expected to obtain an ETF after a court criticized the U.S. SEC's rejection of its application. BlackRock, the world's largest asset manager, also has a bitcoin ETF application at the SEC. The appearance of BlackRock's ETF on a market utility's website indicates progress in the preparation process. The surge in BTC resulted in over $167 million in derivative positions being liquidated, while open interest dropped from $10.5 billion to $9.4 billion. Additionally, the options market is showing signs of increased activity.
Morgan Creek Capital founder and CIO Mark Yusko predicts that Bitcoin and the crypto markets have entered a fresh bull market that could last until next year's halving event. Yusko believes that Bitcoin will replace gold as the base layer of money and that Ethereum will have a role as a fiat currency replacement. He also expects a speculative blow-off after the halving event and an overreaction on the downside called crypto winter. At the time of writing, Bitcoin is trading for $30,787.
Bitcoin has had its best start to a year since 2013, up 80.65% since January 1, leading some to believe that the crypto winter may have turned into a crypto spring. Fintech firm Block reported $2.16bn in Bitcoin revenue generated in Q1, up 18% from Q4 and 25% YoY. Fineqia International reported a 66% increase in digital assets under management in 2023, with global Exchange Traded Products (ETPs) with digital currencies as their underlying assets showing a 29% rise in value vis-à-vis the broader digital asset market, which grew 51% in the four months this calendar year.
Standard Chartered predicts that Bitcoin could surge to $100,000 by the end of 2024, representing a 268% increase from current levels, due to bank turmoil, bitcoin halving, and the expected end of Fed rate hikes, among other things. The bank also sees bitcoin's share of the total crypto market cap rising to the 50%-60% range, up from 45% today and from 40% before the Silicon Valley Bank collapse.
Standard Chartered predicts that Bitcoin's value could reach $100,000 by the end of 2024, citing the collapse of mid-tier US lenders as a reason for the cryptocurrency's outperformance. The bank also believes that Bitcoin's share of the total digital assets market cap could move into the 50-60% range in the next few months. The stabilization of risk assets and speculation that the Federal Reserve will ease monetary tightening further also contribute to the "pathway to the USD 100,000 level becoming clearer."
Standard Chartered predicts that Bitcoin could reach $100,000 by the end of 2024, citing recent turmoil in the banking sector, a stabilisation of risk assets, and improved profitability of crypto mining. Bitcoin has rallied this year, rising above $30,000 in April for the first time in ten months, representing a partial recovery after trillions of dollars were wiped from the crypto sector in 2022.
Standard Chartered predicts that Bitcoin could reach $100,000 by the end of 2024, citing recent turmoil in the banking sector, a stabilisation of risk assets, and improved profitability of crypto mining. The bank also noted that Bitcoin has benefited from its status as a "branded safe haven, a perceived relative store of value and a means of remittance." The European Parliament's backing of the EU's first set of rules to regulate crypto asset markets is expected to provide a tailwind for Bitcoin. JPMorgan also recently noted that a technical change to the Bitcoin blockchain in April 2024 could boost its price.
