2025 'demand shocksâ will spike Bitcoinâs price â Sygnum
Surging institutional inflows could cause Bitcoin (BTC) âdemand shocksâ in 2025 and potentially send BTCâs price soaring, according to a Dec. 12 report by Sygnum Bank, a crypto-focused asset manager.
Institutional capital flows are already exerting a âmultiplier effectâ on BTCâs spot price, with every $1 billion worth of net inflows into spot exchange-traded funds (ETFs) driving an approximately 3-6% price pump, Sygnum said in its Crypto Market Outlook 2025 report.
Sygnum expects this dynamic to accelerate in 2025 as large institutional investors â including sovereign wealth funds, endowments, and pension funds â add Bitcoin allocations.
âWith improving US regulatory clarity and the potential for Bitcoin to be recognized as a central bank reserve asset, 2025 could mark steep acceleration for institutional participation in crypto assets,â Martin Burgherr, Sygnumâs chief clients officer, said in a statement.
âOur analysis shows how even relatively modest allocations from this segment can fundamentally alter the crypto asset ecosystem
Uncertain altcoin outlook
This trend will only extend to alternative cryptocurrencies if the United States passes laws supporting crypto adoption, Sygnum said.
Altcoins will only thrive if US lawmakers create rules âtailored to the asset class allow[ing] projects to pass value to tokenholders without triggering a compliance burden they cannot reasonably fulfill,â the report said.
Sygnum flagged the proposed Financial Innovation and Technology for the 21st Century Act (FIT21) and Payment Stablecoin Act as especially important for crypto.
Strong Bitcoin ETF demand
On Nov. 21, US Bitcoin ETFs broke $100 billion in net assets for the first time, according to data from Bloomberg Intelligence.
Bitcoin has dominated the ETF landscape since spot BTC ETFs launched in January. Investor interest accelerated after crypto-friendly President-elect Donald Trump prevailed on Nov. 5 in the US elections.