Can Bitcoin Still Rise? Four Catalysts the Crypto Market May Have Overlooked
With Bitcoin prices already high, the market generally believes that most positive news, such as ETF adoption and corporate reserves, has already been reflected in the price.
However, in a recent article, Bitwise's Chief Investment Officer, Matt Hougan, stated that while positive developments in regulation, the growth of stablecoins, and institutional adoption are well-known benefits, there are still four potential catalysts in the market that have not completely fermented, which could push prices to new highs in the coming months.
More national governments will purchase Bitcoin.
Hougan stated that the three anticipated sources of Bitcoin demand by early 2025—ETFs, corporations, and governments—have shown strong performance in the first two, but the government's adoption as a reserve asset is progressing relatively slowly.
According to internal discussions at Bitwise, although the pace of governments and central banks is slow, progress is indeed being made.
He predicts that several countries may announce their plans by the end of the year, which will be sufficient to establish government adoption as a major catalyst for 2026, and the realization of just this could significantly raise prices.
Weaker Dollar and Lower Interest Rates
Currently, there is a unique phenomenon where the price of Bitcoin has reached a historical high as US interest rates approach their highest point since 2009. Hougan believes the market has underestimated the Trump administration's strong desire for a weaker dollar and a dovish Federal Reserve.
He analyzed that from Trump's direct criticism of current Fed Chair Jerome Powell to the nomination of weak dollar advocate Stephen Miran to the Federal Reserve Board, the signals from the government indicate more rate cuts and a weaker dollar.
If money printing leads to a significant reduction in interest rates and a weaker dollar, it will constitute a major benefit for non-yielding assets like Bitcoin.
Lower volatility leads to higher allocations.
A less reported trend is that since the Bitcoin Spot ETF launched in January 2024, its volatility has significantly decreased and is currently comparable to that of high-volatility tech stocks like Nvidia.
Image Source: Bitwise Volatility: Bitcoin Compared to Tesla, Nvidia, and Meta
Hougan stated that this shift is changing the perspective of institutional investors. Previously, initial allocations from institutions started at 1%, but now he often hears discussions starting at 5% or higher.
This is also why ETF capital inflows continue to accelerate, performing strongly even in the traditional off-season of summer, and he expects this trend to continue accelerating in autumn.
Data from SoSoValue shows that since January 2025, the US Bitcoin Spot ETF has experienced net inflows ranging from $2.9 billion to $6 billion in several months, with the worst month being February, which saw an outflow of $3.56 billion.
Since its listing in 2024, the US Bitcoin Spot ETF has accumulated nearly $55 billion in net inflows.
Image Source: SoSoValue
ICO 2.0: The Rebirth of Crypto Fundraising
ICOs (Initial Coin Offerings) have gained notoriety in the past due to rampant fraud, but Hougan cited a recent speech by SEC Chairman Paul Atkins on the 'Crypto Initiative,' indicating that ICOs are expected to welcome a '2.0 version' rebirth.
Atkins has asked the team to propose tailored disclosure rules, exemptions, and safe harbor provisions for activities like ICOs and airdrops. Hougan believes that a regulated and healthier ICO market, if realized, could inject a significant amount of new capital into the crypto space.
Further Reading:
SEC Launches Crypto Initiative! Will It Chain the US Financial Market? 5 Core Visions at a Glance
What is an ICO?
ICO, or Initial Coin Offering, refers to a method where companies or projects raise funds from the public by issuing their unique cryptocurrency tokens, similar to an IPO in the stock market.
Investors at that time would hope to increase the value of the tokens by purchasing these newly established ICO tokens, anticipating the future success of the projects.
However, during the ICO boom from 2017 to 2018, the lack of comprehensive regulatory oversight led to numerous fraudulent projects, resulting in significant losses for investors, prompting countries to tighten regulations.
If a compliant 'ICO 2.0' can emerge, it will be regarded as an important milestone for market maturity.
Further Reading:
What is an ICO? Is there fraud? The most complete ICO trading guide.
'Can Bitcoin Still Rise? Bitwise: 4 Major Benefits Not Yet Priced In, ICO 2.0 May Become the Next Narrative' was first published in 'Crypto City'
