Will history repeat itself? Key differences and similarities
The pullback in December last year seemed perilous, but the underlying logic shows significant differences compared to the current situation:
Deepening institutional process: After the approval of the Bitcoin spot ETF in 2024, traditional capital will accelerate its entry. Currently, institutions hold 15% of the circulating supply of Bitcoin, with listed companies holding $349 billion, far exceeding last year's levels. This "coin hoarding trend" significantly reduces market selling pressure, while institutional holdings had not yet formed a scale effect during last year's pullback.
Liquidity siphoning effect: Bitcoin ETFs saw weekly inflows exceeding $40 billion, and the inclusion of Coinbase in the S&P 500 will bring passive funds into the crypto market, forming a "funding moat." In contrast, the market at the end of last year relied on retail sentiment for support, making liquidity more fragile.
Improved regulatory environment: The U.S. "GENIUS Stablecoin Act" has passed procedural voting, and the Trump administration has promoted a "strategic Bitcoin reserve" plan, shifting the policy direction from suppression to acceptance. Meanwhile, during last year's pullback, policy uncertainty remained a major risk.
