The cryptocurrency world is buzzing with speculation that bitcoin could reach an unprecedented US$200,000 by 2025. While bitcoin has yet to stabilise around the US$100,000 mark, its meteoric rise in 2024 has emboldened investors and analysts to project a bullish future for the world’s leading digital asset.
The regulatory landscape in the United States has significantly improved following the 2024 US elections. President-elect Donald Trump’s embrace of cryptocurrencies marks a pivotal moment.
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Crypto’s magnificent three – Bitcoin, Ethereum and Solanato – are to hit new all-time highs in 2025, with bitcoin leading the rise to trade above US$200,000. That’s a prediction by some analysts at Bitwise Asset Management (“Bitwise”).
In addition to Bitwise, other analysts projecting bitcoin to reach US$200,000 include Geoff Kendrick, head of crypto research at Standard Chartered, and analysts at Bernstein, led by Gautam Chhugani.
Essentially, crypto has emerged as a clear winner in the 2024 US elections, giving it a brighter regulatory outlook in the United States, Bitwise Asset Management notes.
Trump has announced plans to create a strategic bitcoin reserve and nominated Scott Bessent as Treasury Secretary. Bessent’s earlier comment that “crypto is about freedom and the crypto economy is here to stay” reflects the administration’s pro-crypto stance. The reshuffling of the Securities and Exchange Commission (SEC), which has historically taken a sceptical view of digital assets, adds another layer of optimism.
Crypto equities mirrored this bullish trend. Companies like MicroStrategy and Coinbase saw their shares skyrocket by 525.39% and 97.57%, respectively. In comparison, traditional assets such as the S&P 500 and gold returned 28.07% and 27.65% over the same period, highlighting crypto’s dominance.
The factors driving bitcoin’s trajectory towards US$200,000 are multifaceted, Bitwise highlights. The launch of bitcoin ETFs in 2024 shattered expectations, and Bitwise believes 2025 will see even greater inflows.
At present, major financial institutions such as Morgan Stanley, Merrill Lynch, and Bank of America have yet to fully embrace bitcoin ETFs. Bitwise anticipates this to change in 2025, unlocking a wave of institutional investments. “The trillions of dollars these firms manage will start flowing into bitcoin ETFs,” Bitwise predicts.
While bitcoin remains the focal point, other cryptocurrencies like Ethereum and Solana are also poised for substantial gains in 2025. Bitwise’s price targets for Ethereum and Solana are US$7,000 and US$750, respectively. Ethereum, despite its impressive 2024 performance, has faced competition from faster- growing programmable blockchains. Solana’s resurgence, driven by memecoin mania in 2024, is also expected to continue as serious projects migrate to its network, it says.
Meanwhile, JP Morgan points out that the role of crypto in portfolio construction is mostly a function of risk tolerance.
While the outlook for bitcoin and the broader crypto market is overwhelmingly positive, risks remain. Regulatory clarity, though improving, is still a work in progress. The global economic environment, including interest-rate policies and geopolitical tensions, could also impact investor sentiment.
However, the convergence of favourable regulatory developments, institutional adoption and technological advancements positions bitcoin as a strong contender to achieve new heights, potentially reshaping the global financial landscape.
Reference:
Heralding the Golden Age of Crypto, Cecelia Kok, Star Biz7 , The Star, 14 Dec 2024
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