Bath, UK – November 5: In this photo illustration, the novelty Bitcoin token… [+] Photographed on a US dollar banknote in Bath, England on November 5, 2023. Since the start of the Ukraine conflict, crypto analysts say millions of US dollars have been donated to Ukraine's war effort through anonymous Bitcoin donations, and the Ukrainian government and many NGOs and volunteer groups have all committed to Advertise your Bitcoin wallet address online. However, concerns have also been raised that the Russian government may use the use of cryptocurrencies such as Bitcoin to circumvent harsh economic sanctions imposed. (Photo by Matt Cardy/Getty Images)
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A new administration has taken office in the United States, promising major changes to the status quo by 2025. Therefore, the global financial ecosystem should have changed significantly by the end of the year. Based on the plans that have already been announced and considering the ramifications it will have, we can begin to envision what that future will look like and predict what will happen in the future. Here are our top 5 Bitcoin and macro predictions for the year ahead and how they could impact the market.
Bitcoin reaches a price equivalent to 50 ounces of gold. Currently, gold is trading at $2,650 per ounce and Bitcoin is trading at $106,000. As of this writing, it takes approximately 40 ounces of gold to purchase one Bitcoin. I believe Bitcoin will continue to rise in gold terms and reach a price equivalent to 50 ounces of gold. At current gold prices, this equates to a BTC price of $132,500. In other words, the value of Bitcoin increases not only when it is measured in dollars, but also when it is measured in gold.
I expect to see a number of portfolio recommendations from ETF issuers' research desks and registered investment advisors recommending Bitcoin portfolio allocation. Similar to one recently published by BlackRock. A recent report from BlackRock on Bitcoin states that “similar to gold, investors may prefer to use Bitcoin tactically to hedge against certain risks.” If you are a fully allocated investor looking to rotate into a Bitcoin position, you are investing in a “digital” version of gold, so the tendency is to reduce your gold position to make space. There may be.
At least one G20 country will propose a Bitcoin Strategic Reserve: Everyone in the Bitcoin community is understandably excited about the possibility of the US creating a Bitcoin Strategic Reserve, but the geopolitical domino are beginning to crumble, and they will continue to fall whether or not the US withdraws. Trigger or not.
Countries such as El Salvador and Bhutan already have Bitcoin reserves, and those reserves have increased significantly in recent years. Healthy financial reserves that are uncensorable and free of counterparty risk mean increased geopolitical influence for nation-states. Some may want to repeat this success. There have been some recent examples of presidential candidates running on Bitcoin platforms in countries such as Suriname and Poland, and proposals for Bitcoin reserves have already been submitted in countries such as Brazil and Japan. I believe that at least one more G20 member country will announce plans for a Bitcoin Strategic Reserve sometime in 2025.
Crackdown on Bitcoin Miners: As countries begin to understand the strategic importance of accumulating Bitcoins, they focus on how Bitcoins are produced and identify those that are underutilized or under-productive. You will come to know that you can utilize energy sources to generate Bitcoins. In parallel, it will also investigate companies currently mining Bitcoin in the country for public-private partnerships. I hope that some countries will establish regulatory bodies to oversee Bitcoin mining. It is also expected that some countries will actively pursue “unregistered” miners who do not comply with their national regimes and regulations. We saw this happen in Venezuela last year, and we may see similar actions in other countries throughout 2025.
US dollar stablecoin surge: Together, Circle and Tether currently hold approximately $136 billion in US debt, making them the 18th largest holder of US debt in the world. USD stablecoins will grow into very large buyers of US Treasuries at a time when the Federal Reserve is desperate to deleverage its balance sheet (i.e. when it needs to sell some of its bond holdings) Possibly. And they are always looking for buyers who will accelerate their debts.
I think the Trump administration could recognize this and regulate USD-denominated stablecoins like Circle and Tether, helping the U.S. further penetrate the USD and become an active buyer of the U.S. We look forward to solidifying our partnership as a strategic partner. National debt.
This environment should more than double the market capitalization of USD-pegged stablecoins from around $200 billion today to around $500 billion by the end of 2025.
The Euro will trade below par against the USD: There are many layers to this reasoning and prediction, but for now let's focus on macro and crypto factors. Generally speaking, the EU has a much slower growth rate than the US on a gross domestic product (GDP) basis. Year-to-date, the EU has grown by +0.8% and the US has grown by +2.8%. As a result, analysts predict that the EU will have to cut interest rates more aggressively than the US Federal Reserve in 2025, which will put pressure on the euro.
Additionally, from a cryptocurrency lens, on December 30, 2024, the long-awaited MiCA Cryptocurrency Regulatory Framework will come into effect in the EU. While there are positives to regulatory clarity for the industry and clear protection for users, investors and consumers, this set of rules can be complex and costly for young startups to comply with. It may take some time. In parallel, the incoming Trump administration in the US has signaled to US regulators a shift towards promoting cryptocurrencies, reviving conversations among founders in the field about whether to relocate to the US or set up businesses domestically. It's activated. This could attract innovation and investment from Europe into the crypto sector in the future, potentially further weakening the euro.
The euro has been trading above the US dollar for the past 20 years or so, and I wouldn't be surprised if we see a multi-year period in which it trades below the US dollar.
Here are my top 5 for 2025. We'll be keeping an eye on the market and coming back next December to see how it turns out.
