FameEX Hot Topics | Bitcoin Rally Expected to Extend Through End of 2025

Bitcoin achieved a historic milestone on December 6, surpassing $100,000 for the first time, despite sluggish performance in most global assets and declining global liquidity. Over the past month, Bitcoin’s price surged by 32%, contrasting sharply with oil’s 6.3% drop, a 1% decline in the S&P 500, and gold’s 1% decrease. This divergence underscores Bitcoin’s resilience and growing investor confidence.

The rally has fueled optimism among analysts, with many predicting that the current bull market could extend until the end of 2025. This phase is referred to as the “euphoria stage” in crypto trading circles, marked by heightened market excitement and significant price momentum. Quinten François, co-founder of WeRate, emphasized this in a December 7 post, stating, “Bitcoin is entering the euphoria stage. You have a maximum of 12 months before the cycle top.”

The long-term holder net unrealized profit/loss (NUPL) metric supports this analysis, showing that Bitcoin is in a state of profit among most holders. NUPL measures the difference between unrealized profit and unrealized loss, providing insight into the market’s sentiment and financial standing. This metric suggests the rally could persist, giving Bitcoin a potential peak before the end of 2025.

James Coutts, chief crypto analyst at Real Vision, noted the significance of Bitcoin’s performance against a backdrop of deteriorating global liquidity. In a December 6 post, he warned that while the rally is impressive, worsening liquidity conditions could limit its duration. Conversely, easing liquidity could trigger a pullback, potentially paving the way for further growth. Coutts highlighted Bitcoin’s ability to hit new all-time highs despite challenging financial conditions as a sign of its resilience.

Raoul Pal, founder and CEO of Global Macro Investor, provided a longer-term outlook, suggesting that Bitcoin’s correlation with the global M2 liquidity index indicates a potential “local top” of over $110,000 by January 2025. As liquidity conditions stabilize, Bitcoin’s trajectory appears poised for further growth in the short term, potentially followed by a correction before new heights are achieved.

Disclaimer: The information provided in this section is for reference only and does not represent any investment advice or the official views of FameEX.