Bitcoin’s Momentum Cools: What’s Next for 2025?

Bitcoin ended 2024 on a high note, peaking at $107,000 in mid-December before settling around $98,000 as 2025 began.

This remarkable growth over the past year has left many wondering about its next moves.

Last week, BlackRock’s iShares Bitcoin Trust ETF (IBIT) recorded its largest outflows since its launch, with $333 million withdrawn. Analysts have attributed this to profit-taking, tax planning, and a broader market cooldown. Andy Baehr, Managing Director of Indices at CoinDesk, explained that such cycles of momentum followed by consolidation are typical in crypto markets. He pointed to Bitcoin’s ETF-fueled surge in early 2024 and another rally spurred by key Federal Reserve meetings and the U.S. presidential election later in the year.

Baehr emphasized the importance of long-term thinking for crypto investors, urging patience during quieter periods and enthusiasm during moments of significant market activity.

As Bitcoin celebrates 16 years since the Genesis Block, Baehr identified key factors propelling its adoption: the inclusion of Bitcoin in government reserves, increasing enterprise applications, growing institutional investment, and broader public engagement through financial advisors. He believes these trends will not only enhance adoption but also help stabilize Bitcoin’s historically volatile price over the long term.

Regulatory developments remain a pivotal influence. Bitcoin already operates within a robust framework of futures, ETFs, and options, but stablecoins are poised to gain attention this year. Baehr suggested that if stablecoin legislation passes, it could drive greater use of blockchain platforms like Ethereum and other layer-1 networks, expanding their utility.

While the market’s momentum has slowed since December, Baehr expressed optimism about what lies ahead. He predicts that the next rally could reinvigorate the entire crypto sector, driven by a mix of innovation, adoption, and favorable regulatory changes.