Institutional Investment Surge May Trigger Bitcoin Demand Shock By 2025

According to Odaily, a report released by cryptocurrency-focused asset management firm Sygnum Bank on December 12 suggests that a surge in institutional capital inflows could lead to a 'demand shock' for Bitcoin (BTC) in 2025, potentially causing a significant price increase. Sygnum's '2025 Crypto Market Outlook' report highlights that institutional capital movements have already had a 'multiplier effect' on BTC's spot price. Specifically, for every $1 billion net inflow into spot exchange-traded funds (ETFs), the price of BTC rises by approximately 3-6%. This dynamic is expected to accelerate in 2025 as large institutional investors, including sovereign wealth funds, endowment funds, and pension funds, increase their Bitcoin allocations. Sygnum further notes that this trend will only extend to altcoins if the United States enacts legislation supporting cryptocurrency adoption. Among the proposed laws, the '21st Century Financial Innovation and Technology Act' (FIT21) and the 'Stablecoin Payment Act' are particularly significant for the cryptocurrency sector. These legislative measures are seen as crucial for fostering a broader acceptance and integration of cryptocurrencies beyond Bitcoin, potentially impacting the market dynamics of various digital assets. The anticipation of these developments underscores the growing interest and involvement of institutional players in the cryptocurrency market, which could reshape the landscape in the coming years.