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Bitcoin and cryptocurrencies have been firmly back in the spotlight in recent months, thanks to rising prices.
Following Donald Trump’s resounding US election victory in November, bitcoin – along with countless other cryptocurrencies – has soared as crypto fans and casual speculators bet on a pro-crypto future under the president-elect.
The bull run continued in December, when Bitcoin broke the $100,000 barrier for the first time after Trump promised to nominate Paul Atkins to become the new commissioner of the Securities and Exchange Commission.
The coin is up 117 percent so far this year and is currently trading at nearly $97,000 per token.
It peaked at $107,000 per token earlier this month, after Trump said he could create a strategic reserve of bitcoin, emulating the country’s Strategic Petroleum Reserve.
The token has a maximum total supply of 21 million, of which 19.9 million already exist.
He said: “We are going to do something great with cryptocurrencies because we don’t want China or anyone else (not just China but others to adopt it) and we want to be the head of it.”
With Trump undoubtedly looking forward to his inauguration on January 20, the jury is still out on how many of his crypto promises he will deliver on and what 2025 and the new president will hold for the crypto space.
Bull run: Since Trump’s election victory, Bitcoin has surged, surpassing the $100,000 mark in early December
Where could bitcoin prices go in 2025?
Of course, it’s impossible to know what will happen to the value of bitcoin and other cryptocurrencies next year: prices are volatile.
However, the future looks bright, at least according to Standard Chartered, which has set a bitcoin price target of $200,000 by the end of 2025.
The bank said: ‘Given the potential for new institutional flows in 2025, we are comfortable with our end-2025 price level of around $200,000.
“A stronger-than-expected take-up by US retirement accounts/pension funds, global sovereign wealth funds or a potential US strategic reserve fund would make us even more optimistic.”
While $200,000 seems like a long way to go, financial institutions are now supporting cryptocurrencies and Trump has pledged to reform cryptocurrency regulation, bitcoin could see a considerable boost in 2025.
Simon Peters, market analyst at Etoro, told This is Money that bitcoin is also likely to follow its four-year cycle, which could mean it will peak in 2025.
He said: ‘Bitcoin is following its usual four-year boom and bust cycle, and if history is anything to go by, we typically see the peak of the bull market between 12 and 18 months after the block reward halving.
“With the last block reward halving in April, a peak for the cryptocurrency bull market could occur in late 2025 or early 2026, according to this four-year theory.”
However, this is not guaranteed, as David Morrison, senior market analyst at Trade Nation, pointed out the pullback Bitcoin has experienced from its previous highs.
He said: “If Bitcoin makes further progress from now on, then it could be that $100,000 becomes the next significant support level and a launching pad for further gains.”
Currently, support for the cryptocurrency is around $90,000, he said.
Regulation prepared for changes
One of the main catalysts for the recent cryptocurrency boom is Trump’s promise to replace much-maligned SEC Chairman Gary Gensler with Paul Atkins.
Gensler, who announced he will resign following Trump’s inauguration, is disliked by those in the crypto sphere for his approach to currency enforcement, and SEC Commissioner Mark Uyeda even admitted that The SEC towards cryptocurrencies has been a “disaster.” ‘for the entire industry.
According to David Morrison, senior market analyst at Trade Nation, this was: “the icing on the cake and solid evidence that cryptocurrencies are about to enjoy a much friendlier regulatory environment.”
Nick Jones, CEO of Zumo, agrees. He told This is Money: ‘Increased regulatory scrutiny is a positive sign that our industry is maturing.
“And now companies must respond by adopting appropriately robust governance, risk management and compliance frameworks.”
Trump has pledged to ease the regulation of cryptocurrencies and create a new regulatory framework that seeks to further integrate cryptocurrencies into the financial world. This is where Trump’s nbitcoin reserve could come in.
Other nations could also follow suit and adopt bitcoin as a reserve asset if Trump takes this approach.
Laith Khalaf, head of investment analysis at AJ Bell, said: ‘New news on US government support policies in 2025 could continue to boost cryptocurrencies.
‘Bitcoin could end the year at $20,000 or $200,000, and no one should be surprised by the previous price action.
“If Trump follows through on his promises to boost the cryptocurrency industry in the US, that should generate a positive news flow, which in turn should keep the plates spinning.”
Adding to this, Arnoud Star Busmann, CEO of Quantoz Payments, said: “All of this will lead to cryptocurrencies being safer and easier to access, through familiar channels such as ETFs and traditional investment advisors, which will attract an unprecedented number of investors. allocate a portion of your portfolio to it next year.
However, Khalaf warns that bitcoin remains a risky investment. He added: “With no fundamentals to speak of, the price of bitcoin depends purely on what other buyers are willing to pay for it, and crowd sentiment is a fickle beast.”
Cryptocurrencies will become common
With a safer regulatory environment, there will also come a wave of new investors looking to buy cryptocurrencies. The value of crypto tokens is fundamentally based on investor interest, so this should prove positive for the space.
Laith Khalaf said: ‘Seven million people in the UK now own some cryptocurrency, according to the FCA, not far off the number who have some money in stocks and shares Isa, a conventional investment account that has been around for 25 years.
‘No doubt many of the seven million cryptocurrency holders are gambling with a small amount of money, but each of them should be willing to accept large losses if the market turns against them and, in the worst case, wave goodbye to your money completely.’
In fact, Star Busmann says that 2025 is likely to see the largest influx of cryptocurrency investors as a result of increased regulation and impending legislation that will make cryptocurrencies a more acceptable asset class.
“I expect bitcoin price to continue its bullish momentum in 2025. But with a multitude of potential catalysts such as growing adoption of corporate treasury, discussions on national strategic reserves and the prospect of regulatory clarity in the US in 2025, to name some, “It promises to be an exciting year in this space.”
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