Crypto Update | Could Bitcoin Hit $1M by the End of 2025?

Summary

Markets Daily Crypto Roundup: Crypto Update | Could Bitcoin Hit $1M by the End of 2025?

Release Date: January 21, 2025
Host: Jen Senassi
Guest: James Van Stratten, Senior Analyst at CoinDesk

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Introduction

In the latest episode of Markets Daily Crypto Roundup, hosted by Jen Senassi, CoinDesk delves into the dynamic movements within the cryptocurrency markets, offering listeners insightful analysis and projections. The episode titled "Crypto Update | Could Bitcoin Hit $1M by the End of 2025?" features a deep conversation with James Van Stratten, a senior analyst at CoinDesk, who provides his expert perspective on Bitcoin's current trajectory, institutional involvement, the potential for reaching unprecedented price highs, and the evolving landscape of other major cryptocurrencies like Ethereum.

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Bitcoin Market Analysis

The discussion begins with a focus on Bitcoin's recent performance. James Van Stratten highlights the bullish trend despite some volatility:

[00:00] James Van Stratten: "I don't know about a million, because I don't really think that's in the realms of possibility. But never say never. But I think 100, 180 at the end of Q1 and that price for the end of the year is really possible."

Van Stratten elaborates on Bitcoin's resilience, noting that after hitting an all-time high, it experienced a minor correction but continues to exhibit strong bullish sentiment. He emphasizes that the recent price stability is not driven by retail investors but by larger institutional players, indicating a more robust and sustainable market demand.

[02:32] Jen Senassi: "Makes sense of that for me. So it's not retail that's contributing to this price action that we're seeing, that means that there's more institutions. What does that tell you about how bitcoin performs over the rest of the year?"

[02:45] James Van Stratten: "Well, for me it's extremely bullish... Bitcoin's kind of shrugged it all off as it would in a bull market. So it's up about 10% this year. So it seems really, really strong. And I expect it to carry on into Q1 of this year."

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Cycle Comparison and Potential Price Targets

Van Stratten delves into the possibility of Bitcoin reaching $1 million by the end of 2025 by drawing parallels to the 2017 bullish cycle. He provides a nuanced analysis, comparing current trends with those observed during Bitcoin's historic bull run.

[03:58] James Van Stratten: "... Bitcoin's up around 550%. If you take from the bottom in the 2017 cycle, which was January 2015... we are very, very similar to that cycle. And if we were to carry this cycle... we are on a trend we're on."

While expressing skepticism about the $1 million mark, Van Stratten remains optimistic about significant price increases, projecting Bitcoin could reach approximately $180,000 by the end of the first quarter and maintain a strong upward trajectory towards year's end.

[06:21] James Van Stratten: "I don't know about a million because I don't really think that's in the realms of possibility... I think 180 at the end of Q1 and that price for the end of the year is really possible."

He attributes this bullish outlook to potential policy changes, such as the repeal of SAB121, which he believes would act as a significant catalyst for institutional adoption.

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Institutional Involvement and MicroStrategy's Bitcoin Purchases

The conversation shifts to the notable role of institutional investors in sustaining Bitcoin's price momentum. Van Stratten points out the significant absorption rate of Bitcoin in the market, suggesting that major players are actively purchasing and holding rather than selling.

[06:21] James Van Stratten: "... there's an accumulation game going on trying to buy, like Michael Saylor when he buys, he buys on an average basis each day."

Jen Senassi brings up MicroStrategy's aggressive Bitcoin acquisition strategy, highlighting their recent purchase of 11,000 Bitcoin within a week. Van Stratten acknowledges this trend, noting that it's a testament to the market's confidence and the strategic maneuvers of companies like MicroStrategy.

[08:20] James Van Stratten: "He is extremely efficient with what he's saying and he's really clear... this increases the uncertainty, which increases his volatility on his stock. And that's kind of how he's packaged MicroStrategy now as a volatility equity."

Van Stratten explains that Michael Saylor's consistent and transparent approach to Bitcoin investments has positioned MicroStrategy as a proxy for Bitcoin itself, enhancing its attractiveness to investors seeking exposure to cryptocurrency volatility.

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Ethereum’s Performance and Market Dynamics

Transitioning to other major cryptocurrencies, the episode explores Ethereum's performance relative to Bitcoin. Van Stratten observes a divergence in their market behaviors, indicating a maturing crypto market where different tokens begin to move independently based on their unique attributes and use cases.

[09:51] James Van Stratten: "... Solana is up around 30% this year where Ethereum is flat to negative. So again, I think that's quite indicative of, I believe, future performance."

He notes that while Bitcoin often leads the market trends, Ethereum and other altcoins like Solana and Ripple are starting to exhibit independent movements, suggesting a diversification in investor interests and strategies within the crypto ecosystem.

[09:33] Jen Senassi: "Now, you know, James, there was a time when we talked about Bitcoin, we would also be talking about Ether. The two kind of really seem to move in lockstep, and that's feeling kind of different now."

This shift underscores a growing sophistication among crypto investors, who are increasingly discerning between different assets rather than viewing the market as a monolithic entity.

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Conclusion and Final Thoughts

As the episode wraps up, Van Stratten reiterates his belief in Bitcoin following historical cycles, albeit with adjusted expectations for growth rates compared to 2017. He anticipates a "mania phase" potentially commencing in the fourth quarter, accelerated by favorable policy changes.

[11:39] James Van Stratten: "I believe we follow the cycle. I just don't believe we will get the returns of the 2017 cycle. But there will be a mania phase that I thought would start in Q4 that could be brought nearer into Q1 if these policies by Trump are announced."

Jen Senassi closes the discussion by directing listeners to Van Stratten's detailed article on CoinDesk titled "Bitcoin could cross $1 million by year end if it continues to follow the 2017 cycle," encouraging those interested to explore his comprehensive analysis further.

[11:14] Jen Senassi: "For anyone who wants to read James's article, it's on coindesk.com, it's called Bitcoin could cross $1 million by year end if it continues to follow the 2017 cycle."

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Key Takeaways

• Bitcoin’s Bullish Trend: Despite minor corrections, Bitcoin maintains a strong upward trend supported by institutional investments rather than retail buying.

• Cycle Analysis: Comparisons to the 2017 cycle suggest significant growth, with projections of reaching up to $180,000 by the end of Q1 2025 and potentially higher by year's end, though $1 million remains unlikely.

• Institutional Influence: Major players like MicroStrategy are heavily investing in Bitcoin, enhancing market stability and investor confidence.

• Ethereum’s Divergence: Ethereum and other altcoins are beginning to trade independently of Bitcoin, indicating a more mature and diversified crypto market.

• Policy Impact: Potential policy changes, such as the repeal of SAB121, could act as major catalysts for further institutional adoption and price increases.

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For more in-depth analysis, listeners are encouraged to read James Van Stratten's article on CoinDesk and subscribe to the Markets Daily podcast for future updates and expert insights into the ever-evolving cryptocurrency landscape.

Transcript

[James Van Stratten]

I don't know, about a million, because I don't really think that's in the realms of possibility. But never say never. But I think 100, 180 at the end of Q1 and that price for the end of the year is really possible.

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[Jen Senassi]

Hello and welcome to Markets Daily, hosted by me, Jen Senassi. On this show, we navigate the currents shaping the crypto markets, providing insights against the broader financial landscape. So whether you're actively trading or just interested in the volatility that is the crypto markets, this show is your compass to understanding what's happened, where we are, and where we're going. On today's show, we have CoinDesk senior analyst James Van Stratten joining us. James, welcome.

[James Van Stratten]

Hi, Jen. Thank you for having me.

[Jen Senassi]

Thanks for being here. Now, one of the big stories this morning is that of bitcoin. Bitcoin hit a new all time high yesterday before the inauguration of President Donald Trump. But it's kind of had a little bit of a pullback. Let's talk about what we're seeing in bitcoin this morning. What are you watching?

[James Van Stratten]

Yeah, so it's been a very eventful few days since the, the meme coin bonanza on Friday. And obviously the US Stock market was closed yesterday. So I thought that bitcoin's price isn't a great arbiter of truth. Obviously through the inauguration, there's going to be a lot of noise. So we saw an all time high. We saw a correction below 100, but it's still a very, very bullish sentiment that we're still pretty much trending over 100. It seems like this mentality now of buy the dip. So since the election on November 5th 6th, Bitcoin's gone up from 66,000 to 109,000. And since then, we've only had two 15% corrections. Very uncharacteristic of bitcoin. Usually in these bull markets we get up to a 30% correction. So it shows how much demand there is on these dips. And this is definitely not a retail buying because we can't keep the price at these levels at this high with this amount of volume. So we can see that there are much bigger players playing in the space now as well.

[Jen Senassi]

Makes sense of that for me. So it's not retail that's contributing to this price action that we're seeing, that means that there's more institutions. What does that tell you about how bitcoin performs over the rest of the year?

[James Van Stratten]

Well, for me it's extremely bullish. We've had a lot of uncertainty already. We've had yields or government debt essentially being priced really high globally. In Western countries, obviously we've got China on the opposite going through what appears as mass deflation. You had the dollar go to 110 I think, which was a multi year high. So on the fears of Trump's tariffs. So there was a lot of bearish sentiment and we've kind of. Bitcoin's kind of shrugged it all off as it would in a bull market. So it's up about 10% this year. So it seems really, really strong. And I expect it to carry on into Q1 of this year.

[Jen Senassi]

You recently wrote an article, it's on CoinDesk.com right now. It's called Bitcoin could cross a million dollars by year end if it continues to follow the 2017 cycle. Talk me through that. Um, and talk me through the cycle comparison because there are, when I think about it, you know, there are a few elements that have been added to the equation here. And so just talk me to the comparison and how you're looking at the differences between 2017 and now.

[James Van Stratten]

Yeah, I just. Before I go into the cycle analysis part, it's in. It's important to understand that when bitcoin crossed that from September to now, there's something called long term holders within Bitcoin and they're defined as an investor that's held Bitcoin for 155 days. And we can see all the activity on chain and they've as a cohort have distributed or sold around a million bitcoin, give or take. So the market has absorbed a million Bitcoin and it's continued to trend higher. So it's incredible like going back to the institutional bidding that's going on the absorption, the absorption rate from the amount of bitcoin that's been dumped into the market is incredible to see. But going back to the cycle analysis, Bitcoin did an incredible bull run in 2017 where it crossed 20,000 really briefly for the first time. And my analysis was on from a cycle low perspective. So if you take the cycle low from this cycle, which was the FTX collapse in November 2022, Bitcoin's up around 550%. If you take from. So that's about just over two years so that's about 800 and something days. You then take the bottom in the 2017 cycle, which was January in 2015, which puts us around March 2017. So again, another 800 days and that was also up about 550%. So we're, we're very, very similar to that cycle. And if you remember the 2017 Bull Run, it was pretty monumental. So if we were to carry this cycle, which I'm prescribing to, that we are that we hit around 185,000, which seems bullish. But that's really just a less than a 2x from here at the end of Q1 and then something than a 10x to the end of the year. I'm not saying that's going to happen. I'm just saying that's the trend we're on.

[Jen Senassi]

That's a really big number to fathom. And I find myself on this show telling folks who do these types of analysis, analyses, sorry, that often what needs to happen for the price of bitcoin to kind of realize these new highs.

[James Van Stratten]

I don't know about a million because I don't really think that's in the realms of possibility. But never say never. I think 180 at the end of Q1 and that price for the end of the year is really possible. We are looking at Trump's policies And I think SAB121, that needs to be repealed and that'll be a really bullish catalyst. And that just brings on more institutional adoption. It's more, more friendly. This will allow the banks to essentially just whole custody digital assets that we to leverage against it. They'll be able to make new rev revenue streams against it. So that's something that we're all waiting for free Ross on day one as well. So if he does that, I think the other policies kind of come. The bitcoin reserve I'm not so worried about because I really don't think that a thing that should be mentioned. If they do mention it, it just kind of sends the price a lot higher. And I don't think it's in anyone's interest to send the price that high that quickly. So there probably is an accumulation game going on trying to. A bit like Michael Saylor when he buys, he buys on an average basis each day. So I assume that's something probably the US Government are probably doing now.

[Jen Senassi]

Well, let's talk a little bit about Michael Saylor. A new news story says that MicroStrategy purchased 11,000 Bitcoin over the past Week. When I see these headlines now, I just feel like MicroStrategy is just becoming more and more of a proxy for Bitcoin. We hardly hear about what MicroStrategy is doing other than acquiring more Bitcoin. Talk to me about what these purchases signal and I guess for, for you, and I don't know if you can answer this, but what it means for MicroStrategy as a company.

[James Van Stratten]

Yeah, well, full disclosure, I am a shareholder of Mike Strategy and I have been for a number of years. And what I've realized over these number of years is the market loves conviction and it loves a CEO or a board that know exactly what they're doing. And each year and each time Saylor comes to the market, he is, he's, he's, he's extremely efficient with what he's saying and he's really clear. So today, I believe after market close, there's a special meeting for shareholders. This will take the, the Class A common stock vote to about 10 billion, which seems like a big number, but it allows for future stock split further at the market share sales, which is how he's buying all this Bitcoin at the moment. So. And he's got the preferred stock as well, which is another leverage tool that he's using. So there's many different tools that he's got at his disposal as a public company. So this increases the uncertainty, which increases his volatility on his stock. And that's kind of how he's packaged Mike Strategy now as a volatility equity.

[Jen Senassi]

Now, you know, James, there was a time when we talked about Bitcoin, we would also be talking about Ether. The two kind of really seem to move in lockstep, and that's feeling kind of different now. Talk to me about what you're seeing in terms of Ether's performance.

[James Van Stratten]

Yeah, it's interesting is the market, I think, is understanding and it's getting a bit more knowledgeable on the different assets within the industry. And not everything's tethered to Bitcoin. And I think as the industry evolves and matures, I think these tokens will start kind of trading on their own. So a lot of the traditional finance analysts say bitcoin is tethered to the NASDAQ or it's a leverage play on the nasdaq. And then you have the crypto people saying the crypto tokens are a leverage play on Bitcoin. It's a higher beta. So bitcoin goes up, the crypto stocks go higher and vice versa. When Bitcoin goes down, but it's not really playing like that with a few of the larger tokens now. So that ETH BTC ratio continues to fall. It's now almost hovering around that 0.03 ratio and that's a real concern for Ethereum. I would assume there is a significant amount of rotation going either from Ethereum into Bitcoin and or Ethereum into these smaller tokens like a Solana or Ripple. So it's interesting to see how the market dynamics are playing out. But Solana is, I think it's up around 30% this year where Ethereum is flat to negative. So again, I think that's quite indicative of, I believe, future performance.

[Jen Senassi]

I just want to drive it home for our audience before we let you go. For anyone who wants to read James's article, it's on coindesk.com, it's called Bitcoin could cross $1 million by year end if it continues to follow the 2017 cycle. I know we talked about it briefly, but James, I'm going to give you the chance to just bring it home for us. Do you think that Bitcoin is going to continue to follow the cycle and we see a million dollars by year end?

[James Van Stratten]

I believe we follow the cycle. I just don't believe we will get the returns of the 2017 cycle. But there will be a mania phase that I thought would start in Q4 that could be brought nearer into Q1 if these policies by Trump are announced.

[Jen Senassi]

James, it was a pleasure having you on Markets Daily and you got to come back sometime.

[James Van Stratten]

Thank you for having me and thank.

[Jen Senassi]

You to our audience for watching. If you enjoy listening to Markets Daily, please subscribe to the Coindesk Podcast network that is available on all podcast platforms. If you prefer watching us, we are on YouTube. Subscribe to CoinDesk there, give us a thumbs up and we'll see you tomorrow.