The price of Bitcoin might soar to $160,000 in 2025, driven by favorable global economic conditions and accommodating monetary policies, according to a recent analysis by crypto services firm Matrixport.
Bitcoin made history on Dec. 6, reaching the $100,000 milestone for the first time—a moment that many in the crypto community had eagerly anticipated.
Adding to the bullish outlook, central banks in key regions have implemented measures to stimulate their economies. On Dec. 12, the European Central Bank (ECB) reduced its main interest rate by 25 basis points to 3%, aiming to encourage investment and bolster economic growth.
Similarly, the People’s Bank of China lowered its one-year lending rate by 40 basis points to 5.6% on Nov. 21, marking its first rate cut in over two years amid a slowdown in economic activity.
Jag Kooner, Bitfinex’s head of derivatives, highlighted the global trend of monetary easing as a potential catalyst for Bitcoin and other risk-on assets:
“This simultaneous easing by major central banks could channel more capital into higher-risk investments, including cryptocurrencies. Combined with the seasonal optimism often seen in December, this dynamic may spark a ‘Santa rally,’ pushing Bitcoin and other digital assets higher as investors seek opportunities in the crypto space.”
However, the Federal Reserve’s upcoming decision on monetary policy, set for Dec. 18, could heavily influence Bitcoin’s price direction as the year closes.
Matrixport outlined its optimistic projection in a Dec. 13 social media post, suggesting that Bitcoin’s price could climb significantly over the next two years:
“Our analysis points to Bitcoin potentially reaching $160,000 in 2025, representing a 60% upside. This forecast reflects the growing adoption of Bitcoin ETFs, shifts in the macroeconomic landscape, and expanding global liquidity.”
A Reset for the Next Rally
Traders are also closely watching the Federal Reserve’s final monetary policy decision for 2024. The probability of a 25 basis-point rate cut has surged to 96.7%, up from 82.5% a month prior, according to the CME FedWatch Tool.
Jag Kooner noted that a Fed rate cut could serve as a major tailwind for Bitcoin, potentially driving its price to new highs:
“Lower rates reduce borrowing costs, encouraging more risk-taking by investors. High-risk assets like cryptocurrencies tend to benefit in such environments, as liquidity increases and market sentiment improves. A dovish policy stance could further amplify optimism in the crypto market.”
Recent developments in leveraged trading also position Bitcoin for its next leg upward. On Dec. 9, a $1.7 billion reduction in leveraged positions helped reset the market. Kooner explained that this deleveraging could pave the way for stronger price momentum:
“The clearing of excessive leverage creates a healthier foundation for Bitcoin’s next rally.”
Kris Marszalek, CEO of Crypto.com, had previously suggested that a market-wide deleveraging was necessary before Bitcoin could surpass the $100,000 threshold—a prediction that proved accurate as Bitcoin achieved this milestone in December.
As macroeconomic trends evolve and central banks continue to adjust their policies, Bitcoin’s trajectory toward $160,000 appears increasingly plausible, making it a key focus for investors heading into 2025.
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