Bitcoin is maintaining a price level near 120,000 USD, raising curiosity about whether it can establish a new high this year.
Three main factors are supporting Bitcoin's growth potential, with the new US policy potentially creating the biggest boost for this cryptocurrency.
- Global money supply is increasing strongly, driving funds into Bitcoin and hard assets.
- Bitcoin ETF is gradually approaching the value of gold ETF, opening opportunities to attract large institutions.
- New US policy allowing cryptocurrency investment in 401(k) retirement funds could potentially release massive capital.
Will the increase in money supply push Bitcoin's price higher?
Global liquidation is at a record level, with M2 money supply from 21 major central banks reaching 55.5 trillion USD in July. The United States recorded a budget deficit of 1.3 trillion USD in the first 9 months of the year.
This typically leads investors to seek hard assets like Bitcoin to protect capital. For example, stocks of some leading companies like Nvidia have grown strongly from 2.3 trillion USD to 4.4 trillion USD despite no significant profit surge, showing that liquidation is now more important than traditional valuation.
How close are Bitcoin ETFs to gold fund values?
Currently, US spot Bitcoin ETFs are managing around 150 billion USD in assets, compared to 198 billion USD for gold ETFs.
If Bitcoin ETF surpasses gold, this would be an important milestone confirming Bitcoin is no longer just a risky asset but has become a serious reserve option for large investors and institutions.
This change could encourage national investment funds, public companies, and governments to consider adding Bitcoin to their asset portfolios.
"If implemented correctly, this policy could unlock trillions of dollars in retirement capital for Bitcoin and other legal assets."
Michael Heinrich, CEO 0G Labs, 2025
Why haven't individual investors participated much in this price increase?
Despite Bitcoin rising 116% in the past year, cryptocurrency trading apps like Coinbase and Robinhood have not seen a sudden surge in downloads like in November of the previous year.
This suggests that significant funds from small investors have not yet exploded, creating room for the next price increase if this group returns to the market in 2025.
How does the new US policy create a turning point for 12 trillion USD in retirement capital?
The US government has issued an executive order allowing cryptocurrencies and other alternative assets to be included in 401(k) retirement funds.
The total value of retirement funds in the US is currently around 12 trillion USD, and if applied to IRA, 403(b), 457(b) plans, the capital scale could exceed 30 trillion USD. This capital flow could double the current cryptocurrency market.
"This is a breakthrough milestone that could strongly promote the cryptocurrency ecosystem in the next decade."
Matt Hougan, CIO Bitwise, 2025
What will Bitcoin's next development be?
Despite challenges, the overall picture for 2025 is quite favorable with record money supply, Bitcoin ETF approaching gold, few individual investors participating, and massive retirement capital beginning to flow into the cryptocurrency market.
These conditions could bring Bitcoin into a strong price increase cycle, creating favorable momentum for both investors and financial institutions.
Frequently Asked Questions
1. Why does increased money supply affect Bitcoin's price?
Abundant liquidation typically drives capital into hard assets like Bitcoin, helping prices rise as investors seek safe havens.
2. How do Bitcoin ETFs impact institutional acceptance?
Bitcoin ETF reaching near-gold ETF values shows increasing trust from institutional investors, driving large capital flows into the market.
3. What impact does the policy allowing cryptocurrencies in 401(k) retirement funds have?
This policy opens up opportunities for trillions of dollars in capital to flow into cryptocurrencies, helping the market develop more sustainably.
4. Why haven't individual investors participated much in the current price increase?
The lack of significant increase in trading app downloads suggests small investors have not yet rushed in, creating room for the next price increase.
5. Can Bitcoin reach a new high in 2025?
Current positive economic and policy factors create a premise for Bitcoin to establish a new high in 2025.
